How COVID-19 impacts fintech – research

Funding conditions have changed dramatically due to the coronavirus pandemic

COVID-19 impacts

How COVID-19 impacts fintech – research. Source: pixabay.com

According to CB Insights, the coronavirus outbreak has cut the growth-at-all-costs environment for fintech companies. For comparison, the companies have been facing record funding levels and rising valuations over the last couple of years.

Since a lot of fintechs competing for market share, they have mainly focused on growth and customer acquisition instead of profitability, the research found.

The data showed that as of the end of March, total deals and dollars to fintech companies are down compared to 2019. For instance, from December 2019 to March 2020 there were between 100 and 200 deals, while the past 3 years all saw between 200 and 300 of them.

In addition to that, the research highlighted that deals are falling across geographies, meaning that COVID-19 impact on the fintech space is global. The data showed that Asia, Europe, and North America are set to see the lowest quarterly deal count in years.

Besides, the total funding is also expected to drop. At the current pace, funding to fintech companies for Q1 2020 will likely settle at around $6 billion.

SEE ALSO: