Payments sector has been in news all around this year. There have been new product launches, acquisitions and many companies got funded. Investors have played a major role in funding the ambitions of payment startups. A new report from Knowledgefaber looks at the Investments (5 years) and Acquisitions (2013, 2014) which took place in the sector. The report talks about analysis of investments across years, countries and respective categories (Mobile wallet, POS, Payment Gateways, etc.) of payment companies. The report also mentions the investors involved and the funding rounds which the companies went through.
Around $2.3 bn worth of investments were made in the payments sector by VCs & strategic investors in 2013 & 2014. Venture capital investment in payment technologies hit a five-year high in committed capital in the first quarter of 2014, when 59 start-ups raised $492 million for technologies to support existing payments companies. The central Europe, Middle East, Africa and Emerging Asia regions each grew by more than 20% while Latin America saw a growth of 14.4% in the payments, which prompt venture capitalist and startups to work in payment space. Venture capital funding to international payment startups is growing at a rapid pace. In 2012 the global payment industry got over $300 Mn in funding. Global investment in fintech ventures has risen over 3 times during the last five years, from less than $930 Mn in 2008 to over $2.97 Bn in 2013. The global volume of non-cash payments grew by 8.8% to reach 307 billion in the year 2012, which encouraged new payment startups companies in the global payment space. Usage of funding has been concentrated towards:
- Online lending: Ventures using new data sources to provide better access to credit, including crowd and social funding.
- E-Financial investments: online systems to distribute financial investment products with self-service and planning capabilities organized around the lifecycle.
- Big Data Analytics: platforms to leverage financial and not financial information to provide better services to our customers.
According to the study, more than 90 deals happened in the payments sector in 2013 & 2014. There were less deals in 2014 as compared to 2013 but they were bigger in terms of total value. In 2013, USD 3,683 Mn was spent across 27 deals while in 2014, USD 5,580 Mn was spent across 67 deals. For getting more details on this report and access the content of the study, follow this link