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Despite Headwinds, 'Green' Firms Driving ASEAN Fintech: Report

Fintech funding in the Association of Southeast Asian Nations (ASEAN) dropped 70% year over year, but environmentally conscious firms enjoyed small pockets of success amid broad macroeconomic headwinds, according to a new report from UOB, PwC Singapore and the Singapore FinTech Association.

Singapore, which commands nearly 60% of all ASEAN fintech funding, saw a particularly noticeable 180% decrease in funding year over year, but it still maintained its position as a regional leader, adds the report.

“While the landscape for FinTech funding across the region has certainly been trickier to navigate, it is good to see that Singapore retains its position as the region’s most vibrant destination, attracting the highest number of deals,” said Shadab Taiyabi, president of the Singapore FinTech Association. “It is heartening to us that investors recognise the quality of Singapore’s firms and their ideas, and we are confident that despite lower levels of funding, Singapore’s FinTech star will continue to shine brightly not just across the region, but worldwide.”

The report, FinTech in ASEAN 2023: Seeding the Green Transition, indicates that despite these challenges, sustainability is attracting “significant” interest from investors both in the region and globally. To that end, the $169 million invested in 9M23 represents the continuation of a five-year-long uptrend.  

“Despite markets and investors becoming more cautious this year, bright spots remain with certain FinTech segments such as early-stage and Green FinTechs showing resilience. As a long-term supporter of FinTechs, UOB is committed to journeying through this uncertain climate with the broader FinTech and Green Tech ecosystem by leveraging on our regional network to seize opportunities and drive innovation,” said, Janet Young, managing director and group head for channels & digitalisation and strategic communications & brand at UOB.

According to the report’s authors, as cited in Cision PR Newswire, the interest in sustainability comes in the wake of more aggressive climate regulation, government support and heightened awareness of environmental issues across the board. The Asia Pacific segment is particularly vulnerable to climate impacts, it adds, sparking many nations in the region to explore green financing initiatives.

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Additionally, even as the ASEAN fintech sector did see a noticeable contraction in 2023, projections from Statista anticipate a 35% bump in fintech revenue growth in 2024 as well as a spike in targeted areas like digital payments where users are expected to top off at 490 million by 2027.

“Despite ongoing macroeconomic concerns, FinTech is integrated in the day-to-day operations and lives of many, and it is here to stay. With the climate challenge requiring stronger concerted effort across all industries and governments, Green FinTechs and sustainable finance are spaces where Singapore can take the lead in establishing trust and helping to move the needle on one of the major challenges facing our time. In more than one way, FinTech players have good reasons to persevere and get ready to seize future uptrends,” added Wong Wanyi, fintech leader at PwC Singapore.

The full report can be found here.




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