Southeast Asia’s startup funding dropped for the third consecutive year in 2024, falling to $4.56 billion, a 42% decrease from the previous year. The number of fundraising deals also fell by 10% to 633. Singapore accounted for 68% of the region’s startup funding proceeds in 2024.
Despite this, only one unicorn was minted as late-stage deals declined. The trend shows increasing caution among investors as they navigate macroeconomic uncertainties and changing political landscapes. The tightening funding environment has put more pressure on startups to show sustainability and profitability to attract investment.
Some notable fundraising efforts included Singapore’s Funding Societies raising $25 million from a Japanese fund and Singapore fintech Tyme securing $250 million to drive growth across Southeast Asia. A Singapore startup has planned a quantum cryptography satellite launch in 2025, aiming for innovation. Another Singapore robotics startup is expanding into the U.S. and Japan markets with new financial backing.
These successes contrast with the broader trend of tightening capital flows in the region. Stakeholders are closely watching how these conditions will shape the innovation landscape in the coming years. Global asset allocators and investors remain bullish on Indonesia over the long term, despite a slow 2024 that saw startup funding in the country drop to its lowest in over six years.
This optimism was evident during a panel discussion at a summit in Jakarta on January 16. The panel revealed that the growing middle class, digital economy, and strategic initiatives aimed at fostering innovation and infrastructure development are some of the main reasons investors are maintaining a positive outlook on Indonesia. Despite recent setbacks, the long-term potential for growth and returns in the Indonesian market continues to attract global investment interest.
Southeast Asia’s Fintech ecosystem saw a total funding of $1.6 billion in 2024, a 23 percent drop from $2.1 billion in 2023 and a significant 75 percent decrease from $6.3 billion in 2022, according to data platform Tracxn. The funding levels in 2024 have returned to pre-pandemic figures, reflecting challenges posed by macroeconomic conditions, rising interest rates, and geopolitical tensions. Despite the decline, the sector showed resilience and remained one of the top-performing areas in the tech startup landscape in Southeast Asia throughout 2024.
Fintech funding trends in SEA 2024
The industry has experienced notable digital transformation, accelerated by the pandemic’s drive for contactless payments and eCommerce. Investments declined across all stages, with late-stage rounds taking the hardest hit.
However, some bright spots emerged. The payments segment raised $366 million in 2024, marking a 53 percent growth from 2023. Similarly, the cryptocurrencies space attracted $325 million, a 20 percent increase from the previous year.
Banking Tech companies also saw a significant funding boost, securing $265 million, a 63 percent surge from 2023. Neha Singh, Co-Founder and Chief Executive Officer of Tracxn, said, “Southeast Asia’s FinTech ecosystem demonstrated remarkable resilience in 2024 despite the drop in overall funding. Despite challenges such as rising interest rates, the sector’s innovative spirit continued to shine, with segments like payments and cryptocurrencies achieving significant growth.
This is a pivotal moment for startups to refine their strategies and unlock the region’s immense potential.
Among the notable deals of 2024, Ascend Money’s $195 million Series D round was the biggest in Southeast Asia’s FinTech landscape. Other significant deals included ANEXT Bank’s $148 million Series D round and Bolttech’s $100 million Series C round. Polyhedra Network became the only new unicorn in 2024 after raising $20 million in a Series B funding round with a valuation of $1 billion.
The ecosystem also saw 27 acquisitions, a slight increase from 26 in 2023, with the largest being NTT Data’s acquisition of GHL for $154 million. No FinTech company in the region went public in 2024, in contrast to the one initial public offering (IPO) in 2023. Singapore led the funding activity this year, followed by Jakarta and Bangkok.
FinTech companies based in Singapore raised $955 million in 2024, while those headquartered in Jakarta and Bangkok raised $242 million and $198 million, respectively. Abhishek Goyal, Co-Founder of Tracxn, said, “The Southeast Asia FinTech ecosystem is at an inflection point. While macroeconomic challenges have tempered funding activity, the region’s dynamic entrepreneurial spirit, young, tech-savvy population, and supportive government initiatives promise a bright future.”
The SEA FinTech ecosystem faces challenges such as declining demand, valuation concerns, and rising geopolitical risks, but long-term growth prospects remain optimistic.
The region’s young, tech-savvy population, large consumer base, reliance on informal financial systems, and supportive government initiatives aimed at enhancing financial inclusion provide a strong foundation for future growth.
