SINGAPORE (Feb 13): Singapore achieved a record high of US$299.1 million ($396.3 million) of fintech funding in 2017, according to the KPMG Pulse of Fintech report.

This was attributed to two of Asia's top 10 biggest deals taking place in Singapore in Q4 – GoSwiff’s US$100 million purchase by Paynear Solutions which boosted deal volume to an unmatched high over the prior three years, and Smartkarma’s US$13.5 million series B round.

Singapore has continued to showcase its value as an Asia-based fintech hub, especially in areas like blockchain, AI, and machine learning. It has also attracted a significant amount of foreign attention; well-established VC funds, large corporates and even more established fintech companies have made investments or set up shop in the country as a base for expansion into Southeast Asia.

The Monetary Authority of Singapore (MAS) has targeted financial inclusion as a critical priority in 2018, with the focus on making it more accessible and cost effective for individuals working in the country to remit payments to family elsewhere in the region.

Globally, fintech funding reached over the US$31 billion mark for 2017, boosted by strong investment of US$8.7 billion in 4Q17, Hence, the total global investment in the fintech sector over the past three years stood at US$122 billion.

Although Q4 saw global fintech deal volume decline, the number of venture capital (VC) transactions exceeded 1,000 for the fourth consecutive year in 2017, while private equity (PE) deals also reached a new high of 129.

Fintech M&A also ticked up for the year with 336 transactions in 2017.

Among fintech sub-sectors, both insurtech and blockchain saw record levels of VC investment and deal volume in 2017, with insurtech accounting for US$2.1 billion across 247 deals and blockchain generating US$512 million of investment across 92 deals.

Chia Tek Yew, head of financial services advisory of KPMG Singapore says, “In Singapore and across Southeast Asia, financial inclusion is a big focus area, with fintechs focused on everything from micropayments and microlending, to remittances and even microinsurance. Given the fragmented markets, fintechs are not taking a disruptive approach to these services, focusing instead on building partnerships with telcos and other local players in order to better engage with potential customers.”