Asia catching US in value of fintech deals

Venture capital investment in Asia-based fintech start-ups reached $5.4 billion in 2016 just shy of the $5.5 billion invested in the US.

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Asia catching US in value of fintech deals

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The 2016 total, boosted by a number of massive deals involving Chinese investors, was an increase on the previous year's total investment of $4.8 billion, while the number of transactions rose slightly from 162 to 165.

In contrast, the $5.5 billion invested in US fintech start-ups was spread across 422 deals. So while Asia only accounted for 20% of such deals, it represented 43% of global funding, according to figures supplied by research firm CBInsights.  

The majority of the fintech investments have come in China - both in terms of the investors and the start-ups. Nine of the top ten deals made in 2016 were based in Mainland China, including the two biggest made in 2016 - the $1.2 billion raised in second round funding for online lender Lufax, led by Shenzhen-based Ping An Insurance, and the $1 billion invested in JD Finance, an affiliate of online shopping firm JD.com.

These two deals were the biggest made in the world in the fintech sector and underline China's huge appetite for fintech investment. CBInsights figures even excluded the $4.5 billion series B share placement issued by Ant Financial, an affiliate of the e-commerce giant Alibaba, that is now valued at $60 billion.

And there is every indication that the size of fintech investment will grow in China during 2017. In early January a consortium of Chinese state-owned companies and private enterprises created a $1.44 billion investment fund,  dedicated to fintech mergers and acquisitions.

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