India's economy holds strong but no thaw in fintechs' funding winter

Funding in first half of this calendar year is at $795 mn, a decline of 11% from second half of 2023

Fintech funding in the first half of calendar year 2024 stood at $795 million, a fall of 11 per cent from the second half of 2023 and a 59 per cent slide from $1.93 billion garnered in the first half of 2023, according to Tracxn Technologies. The decline reflects global trends influenced by a funding winter and geopolitical uncertainties, despite the robust performance of the Indian economy, which grew 8.2 per cent in FY24.

Indian fintechs have faced a funding winter for some time and valuations have changed. This is a global trend, but separately regulatory changes by the Reserve Bank of India have forced fintechs to revisit their business models and governance structures. The banking regulator recently announced its ‘Framework for Self-regulatory Organisation for Fintechs’ to promote self-regulation in the industry. According to Tracxn, a data intelligence platform for private market research, this can help bring trust and stability to the sector.