Global fintech funding in the first quarter of 2020 declined to its lowest level in three years, due to the Covid-19 pandemic.
A report from technology research firm CB Insights found that global funding into fintechs from venture capital firms dropped to $6.1bn (£4.96bn) across 404 deals in the first three months of the year.
This compares to 9.6bn (£7.8bn) across 500 deals in the previous quarter and $7.1bn (£5.8bn) across 538 deals in the first quarter of 2019.
The pandemic has forced investors to pull back their investments, resulting in the worst first quarter since 2016 for fintech deals.
Seed and series A fundraises saw 228 deals, a 13-quarter low, and $1.1bn in funding, a nine-quarter low.
However, Europe was the only major region to see an increase in deal volumes, driven by mega-rounds ($100m plus) including Revolut’s $500m series D and Qonto’s $115m series C.
European fintech funding rose from $1.3bn to $1.6bn quarter-on-quarter. However, the number of deals dropped from 122 to 108 over the same period.
The CB Insights’ report follows similar research from US market research firm Forrester which found a contraction in funding for fintechs, which it said is likely to continue due to the economic slowdown caused by the pandemic.