The first three quarters of 2020 saw APAC fintechs raise a combined $3.9 billion, down 46% compared to the same period last year, while deal volume fell by 20.5% to 318, according to the latest Q3 APAC Fintech Funding Report published by S&P Global Market Intelligence.

Key takeaways from the report include:

• In the third quarter, fintechs in APAC raised $1.3 billion, 8.7% lower than the previous quarter. Year-to-date capital flows into APAC fintechs, however, appear to have hit a trough in June. Both monthly funding volume and value have since risen, possibly signaling a cautious return of investor interest.

• Investors remain open to new investments and early-stage fintechs amid subdued funding climate. Over the first three quarters this year, at least 15 out of 23 large APAC fintech funding rounds with transaction size of $50 million and above still saw participation from new investors, two-thirds of which are in series B or prior.

• In the third quarter, China saw a resurgence in private fintech investments and garnered the most fintech funding value. Deal counts by Chinese fintechs doubled to 20, while venture capital flows surged by more than tenfold to $425 million. Southeast Asia, however, saw the most fintech funding activity, which is in line with our earlier observation that investors are increasingly eyeing opportunities in the region.

• Payment companies continue to lead APAC fintech funding in the third quarter but insurtech was the only category, out of the six fintech industry segments tracked by S&P Global Market Intelligence, that saw an increase in both funding value and volume.