By News18
India鈥檚 financial technology (fintech) sector attracted $889 million in funding during the first half (H1) of 2025, marking a 26% decline from $1.2 billion raised in the second half (H2) of 2024 and a 5% drop from $936 million seen in H1 2024, according to a report by market intelligence platform Tracxn.
Despite the dip, India retained its position as the third-largest fintech market globally, behind only the United States and the United Kingdom.
鈥淲hile the Indian fintech sector has seen a temporary dip in funding, the steady momentum in early-stage investments and growing acquisition activity indicate that investor interest remains strong, particularly in scalable, innovation-led models,鈥 said Neha Singh, Co-Founder of Tracxn. She added that Bengaluru鈥檚 dominance and the rise of breakout companies continue to reinforce India鈥檚 status as a global fintech powerhouse.
Funding activity across different stages showed mixed trends. Seed-stage startups raised $91.2 million, down 27% from H2 2024 ($126 million) and 33% from H1 2024 ($137 million). In contrast, early-stage funding saw a rebound, with startups raising $361 million 鈥 up 10% from H2 2024 ($329 million) and 9% from H1 2024 ($333 million). However, late-stage funding declined sharply to $437 million, falling 41% from H2 2024 ($745 million) and 6% from H1 2024 ($467 million).
The period also saw an increase in merger and acquisition activity, with 16 acquisitions recorded in H1 2025鈥攈igher than the 11 deals in H1 2024 but slightly below 17 deals in H2 2024. The most notable deal was Groww鈥檚 acquisition of Fisdom for $150 million, followed by InCred Money鈥檚 acquisition of Stocko for $35 million.
Although no fintech IPOs occurred in H1 2025, one new unicorn emerged, mirroring H2 2024 and improving on H1 2024, which had none.
Bengaluru continued to dominate the Indian fintech funding scene, accounting for 55% of total investments, followed by Mumbai at 14%. The top overall investors during the period were Peak XV, Angel List, and LetsVenture.
In early-stage funding, Peak XV, Accel, and Bessemer Venture Partners led the way. At the seed stage, Blume Ventures, Venture Catalysts, and 100Unicorns were the top backers, while SoftBank Vision Fund, Lathe Investment, and Sofina led in the late-stage space.
Among venture capital firms, US-based Accel stood out with the highest number of investments (34 rounds), while India鈥檚 Blume Ventures added seven new companies to its portfolio in the same period.