Mumbai, April 28: India’s fintech sector has successfully secured $513 million in funding during the first quarter of 2026, marking a 2% increase compared to the same period last year. However, the number of funding rounds has significantly decreased from 99 to just 45.
According to a report by data intelligence platform Traxion Technologies Limited, while total funding remains stable, the investment approach is shifting. Investors are now focusing on fewer but larger deals.
The average investment amount has more than doubled as investors are channeling funds into established and robust companies. Late-stage funding reached $273 million, a 126% increase from the previous quarter’s $121 million. In contrast, seed funding has dropped to $25.7 million from $72.3 million.
Early-stage funding stood at $214 million, down 47% from the last quarter but up 13% year-on-year.
The report indicates that approximately 60% of total funding was directed towards the online lending sector, highlighting investor preference for business models with proven revenue and operational success.
Investment patterns show a trend where funds are increasingly flowing into early and late-stage companies, while mid-stage investments are declining. Notably, funding for early startups is rapidly decreasing.
This quarter also saw a decline in exit activities, with only two companies being acquired and no new IPOs or unicorns emerging.
Mumbai-based companies received the largest share of funding this quarter, accounting for 61% or $311 million, while Bengaluru secured 30%. Last year, Mumbai’s share was only 9%, with Bengaluru holding 51% of the funding.
The report attributes this shift to the growth of fintech sectors related to online lending and affordable housing. The presence of banks, NBFCs, and insurance companies in Mumbai provides a significant advantage for this sector.
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