141 fintech M&A transactions reported in H1 2018

Fintech merger and acquisition (M&A) transactions in the first half of 2018 reached a value of $39.3bn (approximately £30bn), up more than 26% on the previous half year.

The latest fintech M&A market report from Hampleton Partners found that the global fintech sector reported 141 transactions during the first half of the year.

The surge in activity was attributed to increasing consumer and business acceptance of digital banking, payments and financial data services.

“Fintech M&A activity is coming of age after the initial surge in somewhat random deal-making among the very early innovators,” said Jo Goodson, managing director at Hampleton Partners.

“Now, corporate and financial buyers alike are chasing larger and more targeted investments which can help streamline back-office operations, improve the digital customer experience and cut costs.”

The report found that blockchain solutions, insurance technology and PSD2 were expected to drive the next wave of fintech M&A.

“For the remainder of 2018 going into 2019, we’re anticipating a number of blockchain solutions will come to market and that insurtech could spark a major wave of deals as traditional insurers step up their efforts to innovate their consumer and enterprise offerings through M&A,” said Jo.

Hampleton Partners added that Europe’s challenger banks were acting aggressively to fuel their growth.

“Going forward, the implementation of Europe’s Revised Payment Service Directive, or PSD2, is likely to be a major game-changer for the deal landscape, as it encourages pan-European competition and participation in the payments industry, including non-banks,” added Jo.

“New entrants will find a level playing field and harmonised consumer protection and rights which will encourage new entrants to the financial services market and fuel further M&A deal growth and valuations.”

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