According to Tracxn Technologies Ltd. on Tuesday, the total amount of funding given to Indonesian FinTech startups dropped by 51% to $765 million in 2023 from $1.6 billion in 2022.
According to Tracxn’s “Tracxn Geo Annual Report: Indonesia FinTech 2023,” the Indonesian startup ecosystem has the second-largest economy in Southeast Asia (SEA) and the second-highest overall funding of any startup ecosystem in the region.
Nonetheless, it stated that compared to 2022, funding for Indonesian fintech has decreased because investors are still being cautious because of the global macroeconomic slowdown and other geopolitical concerns.
As per the statement, the amount of funding raised for the seed stage fell by 84% to $9.5 million in 2023 from the previous year.
In the meantime, early-stage funding dropped from $466 million in 2022 to $99.4 million in 2023, a 79% decrease.
Businesses in this field were able to obtain $656 million in late-stage funding in 2023, which represents a 40% decline from the $1.1 billion in 2022.
Regarding a comparison by quarter, funding decreased during 2023’s second and third quarters but increased during the fourth quarter.
In the first and fourth quarters of 2023, funding totalling $312 million and $407 million, respectively, was noted.
But in 2023, only $25.5 million and $21 million were recorded in the second and third quarters, respectively.
In 2023, there were three funding rounds totaling $100 million or more in the Indonesian fintech space, compared to four in 2022 and six in 2021.
In 2023, Investree, GoJek, and Kredvio were the companies that secured funding exceeding $100 million.
Furthermore, in 2023, no new unicorns appeared in this field.
Based on funding, the top-performing segments for the year were Payments, Banking Technology, and Alternative Lending.
Compared to 2022, when $305 million was raised, alternative lending companies received investments totaling $554 million in 2023, an increase of 82%.
In 2023, the payments segment raised a total of $217 million, which is 67 percent less than the $659 million it raised in 2022.
A total of $8.5 million was raised in the banking tech space, an 81 percent decrease from the $44.2 million raised in 2022.
In 2023, the total number of acquisitions in the Indonesian FinTech sector was four, which was somewhat less than the five acquisitions that were reported in 2021 but comparable to the situation in 2022.
Krungsri, Adira Finance, and MUFG paid $219 million for the alternative lending company HomeCredit.
As of right now, the three most active investors in the Indonesian FinTech market are East Ventures, Mandiri Capital Indonesia, and AC Ventures.
In 2023, Gobi Partners, Alpha Trio, and Openspace Ventures were the most active early-stage investors, while 500 Global, Hustle Fund and Mandiri Capital Indonesia were the top seed-stage investors.
