In many parts of the region, particularly outside of China, the aged infrastructure underpinning existing financial markets is driving a significant amount of investment towards the innovation of financial market infrastructure and to the digital last mile of transactions. Regulators in the region are continuing to focus on making industry changes to support open banking and decentralized finance in an orderly and safe way. Investors are taking a more focused approach to their investments, prioritizing investments in companies with very strong business models and distinctive value propositions. Growing focus on B2B solutions and tech enablement of traditional players is expected, rather than standalone FinTech plays.
FinTech investment in China remained limited during 2022 1H. The largest FinTech deal in the country in the first six months of this year was USD140 million raised by corporate expense management company Fenbeitong. Interest in the sector was also tempered as many companies focused on infrastructure plays and partnerships with traditional financial institutions. InsurTechs, however, continued to draw interests. Key areas that garnered attention from investors in the Asia-Pacific region during 2022 1H included supply chain management, cybersecurity and privacy, identity management, and governance and compliance. Open data also saw solid investment during H1’22. In the Asia-Pacific region, the massive interest and hype seen during the past 12 to 24 months over companies operating in a few FinTech subsectors, such as retail payments, InsurTech, and B2C solutions.