Singapore’s fintech market entered 2026 with a familiar contradiction: its strategic appeal remains intact, but capital has become much harder to win.
Fintech companies in the city-state raised just over US$499 million across 53 deals in the first half of 2026, according to KPMG’s Pulse of Fintech H1 2026 report. That is a sharp fall from roughly US$1.45 billion across 97 deals in the same period last year and marks Singapore’s weakest first-half fintech investment performance in close to a decade.
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The headline number, however, masks a more uneven market. Funding was almost frozen in the first quarter, with about US$88 million raised across 26 deals. Activity then rebounded in the second quarter to around US$411 million across 27 deals, but the recovery was heavily dependent on one transaction: a US$320 million round for a cross-border payments platform in June.
That single deal accounted for close to two-thirds of all fintech investment into Singapore during the half. In other words, Singapore did not see a broad-based funding revival. It saw a market where investors were willing to write large cheques, but only for a small number of companies they considered mature enough, defensible enough, and central enough to the region’s financial infrastructure.
“The headline number tells only part of the story,” said Anton Ruddenklau, Partner and Head of Financial Services at KPMG in Singapore. “What we are seeing in Singapore mirrors the global market, where investors are being far more selective, consolidating capital behind a small number of scaled, high-conviction platforms rather than funding behaviour we saw in prior years.”
A funding market that rewards proof, not promise
The shift is stark when viewed against Singapore’s recent fintech cycle. In H1 2022, the country recorded US$3.54 billion in fintech investment across 234 deals, driven by abundant venture capital, pandemic-era digitisation, and investor enthusiasm for everything from digital banks to crypto infrastructure.
By H1 2026, deal volume had fallen to 53, less than a quarter of the level seen four years earlier. The value of investment was also below H1 2019, when Singapore fintechs raised US$610 million across 85 deals.
This does not mean Singapore has lost its fintech relevance. Rather, the market has moved from expansion to filtration. Investors are no longer rewarding growth stories by default. They are asking whether a company has revenue quality, regulatory resilience, enterprise demand, and a credible path to profitability.
That matters for Southeast Asia because Singapore remains the region’s main fintech capital formation hub. Many startups that serve Indonesia, Vietnam, the Philippines, Thailand, and Malaysia still use Singapore as a fundraising, regulatory, or headquarters base. A slower Singapore funding market therefore affects not only local startups, but also regional fintech companies that rely on the city-state to access institutional capital.
Payments still anchor Singapore’s fintech story
Payments remained one of Singapore’s most important fintech verticals in H1 2026, even though the numbers were unusually concentrated. The sector drew US$332 million across three deals, with the US$320 million June transaction accounting for nearly all of that value.
The continued interest in payments is not surprising. Southeast Asia is still a fragmented market when it comes to moving money. Businesses operating across the region often deal with multiple currencies, uneven banking rails, complex compliance rules, and slow settlement timelines. Cross-border payment platforms that can reduce friction in this environment sit close to real commercial demand.
For investors, the most attractive payment companies are no longer those promising consumer wallet adoption at any cost. The focus has shifted to infrastructure: platforms that help businesses move money, manage foreign exchange, comply with regulations, and plug into banking systems.
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This reflects a broader pattern across the region. As digital commerce, travel, remittances and B2B trade expand across borders, payment infrastructure becomes less of a standalone product and more of a core operating layer for companies. Singapore’s role as a regional treasury and financial services hub makes it a natural base for such platforms.
Crypto activity survives, but at earlier stages
Digital assets and cryptocurrency accounted for the largest share of deal activity in Singapore, with 27 deals in H1 2026. Yet the disclosed value was far smaller, at US$95.5 million, suggesting that most cheques were modest.
KPMG’s data shows that much of this activity was concentrated at seed and early stages, with 15 of the 27 digital asset and crypto deals falling into that category. The companies funded ranged from exchange and brokerage platforms to cross-chain tools and other digital asset infrastructure plays.
This is an important distinction. The crypto market that attracted speculative capital in 2021 and 2022 has largely disappeared. What remains in Singapore is more institutional and infrastructure-led. Startups are being built around regulated digital asset services, crypto payments, tokenisation, and tools that connect blockchain networks.
Singapore’s regulatory stance has helped shape this market. The Monetary Authority of Singapore has taken a tougher line on retail crypto speculation while continuing to support institutional use cases such as tokenised assets, stablecoin frameworks, and wholesale settlement experiments. That has made the city-state less hospitable to hype, but more credible for companies trying to build regulated financial infrastructure.
For Southeast Asian founders, this could be a double-edged sword. Singapore offers trust, talent, and regulatory clarity, but it also raises the bar. Early-stage crypto startups can still raise capital, but they need to show they are solving real infrastructure problems rather than chasing token-driven growth.
AI becomes part of the fintech stack
Artificial intelligence and machine learning featured in 18 of Singapore’s 53 fintech deals and accounted for US$365.9 million in disclosed value. Because deals are often tagged to more than one vertical, this overlaps with categories such as payments, crypto, and insurance.
The more interesting story is where AI is being applied. Later-stage deals clustered around software that embeds AI into existing financial workflows, including cross-border payments, investment research, insurance claims, credit-risk modelling, and document processing.
That says something about how fintech investors now view AI. They are not simply backing companies because they use the technology. They are looking for businesses where AI improves margins, automates manual processes, or strengthens an existing product.
At the seed and early stage, KPMG noted interest in agentic software and infrastructure. Agentic AI refers to systems that can carry out tasks with a degree of autonomy, rather than simply responding to prompts. In finance, that could eventually reshape how transactions are executed, how compliance checks are run, and how investment or credit decisions are supported.
The opportunity is significant, but so are the risks. Financial services is a heavily regulated industry where errors can have serious consequences. In Southeast Asia, where regulatory regimes differ widely from one market to another, AI fintechs will need to prove not only technical performance, but also explainability, governance, and compliance.
Singapore follows a global concentration trend
Singapore’s slowdown came as global fintech investment moved in the opposite direction by value. Worldwide fintech investment across venture capital, private equity, and M&A rose from US$72.2 billion in H2 2025 to US$103.1 billion in H1 2026, putting the sector on track for its strongest annual performance in four years.
But here too, deal volume weakened. Global fintech deal count fell from 2,500 in H2 2025 to 2,100 in H1 2026. The Americas dominated activity, attracting US$86.9 billion across 1,120 deals, with the US alone accounting for US$80.8 billion across 933 deals. By contrast, fintech investment in Asia-Pacific remained muted, declining from US$7.1 billion across 426 deals in H2 2025 to US$4.6 billion across 350 deals in H1 2026.
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The message is clear: fintech capital has not disappeared, but it has become more selective. Large transactions, especially in payments and AI-enabled fintech, are pulling up global totals, while smaller startups face a more difficult fundraising environment.
For Singapore, this may not be entirely negative. A leaner market can force stronger business discipline and reduce capital flowing into weak models. But it also means fewer young companies will get the chance to experiment, particularly in sectors where regulatory approval, infrastructure development, and regional expansion require patience.
The city-state’s fintech ecosystem is still built on durable advantages: a trusted regulator, deep links to regional markets, strong financial institutions, and a concentration of venture and corporate capital. What has changed is the cost of convincing investors.
In 2026, being based in Singapore is no longer enough. Fintech startups must show they can solve real cross-border problems, operate within tighter compliance expectations, and build businesses that survive beyond the next funding cycle.
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