India has become the third largest recipient of fintech funding globally in the first half of 2025, after the United States and the United Kingdom, according to a new report from market intelligence platform Tracxn, despite an overall slowdown in capital inflow. As per the report, the Indian fintech sector bagged an investment of $889mn in H1 2025. Although India holds the third largest share of fintech funding, there has been a 26% decline from $1.2bn in H2 2024 and a 5% drop from $936mn in H1 2024.
While total funding witnessed a decline, there has been no dearth of renewed investor confidence in early-stage ventures and there has been a spike in acquisition activity too, stated the report.
“While 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. Bengaluru's dominance and the continued emergence of breakout companies reinforce India’s position as a global fintech powerhouse,” said Neha Singh, co-founder of Tracxn.
Early-stage start-ups have been the major driver of investment during this period as the sector drew $361mn in H1 2025, recording 10% growth from H2 2024 and 9% year-on-year. However, seed-stage funding plunged in the first six months as it declined sharply to $91.2mn—down 27% from the previous six months. Late-stage deals were hit the hardest as funding fell by 41% to $437mn compared to H2 2024.
Despite several headwinds in certain sectors, Bengaluru retained its position as the capital of India’s fintech ecosystem. The tech hub fetched 55% of all funds raised, followed by Mumbai with 14%. Bengaluru was also the hub of some of the period’s most significant transactions, including the acquisition of wealth-tech start-up Fisdom by Groww for $150mn, the highest-valued deal of the half-year. InCred Money’s $35mn acquisition of Stocko also featured among the top transactions.
India's fintech ecosystem witnessed a total of 16 acquisitions in H1 2025—a 45% jump from the same period last year. This is slightly below the recorded number in H2 2024, when 17 acquisitions took place.
The investor base remained significantly diverse. Peak XV, Angel List and LetsVenture were the top overall backers, while Accel, Bessemer Venture Partners and Blume Ventures led investments at early and seed stages. Among VCs, Accel was the most active with 34 deals while Blume Ventures added seven companies to its portfolio.
Despite short-term volatility, the report underscores India’s enduring importance in the global fintech landscape—fuelled by a robust early-stage pipeline and maturing acquisition dynamics.
