Published: May 15, 2025
The fintech sector is going through a phase of consolidation, with a wave of M&A deals announced.
The fintech sector has seen a wave of high-profile mergers and acquisitions. In January alone, MoonPay announced the acquisition of Helio; Elite acquired Tranch; and Neonomics purchased the UK open banking platform Ordo. Meanwhile, Chainalysis announced it had purchased fraud detection solution Alterya; Airwallex finalised the acquisition of MexPago; and Banking Circle announced plans to acquire Australian clearing house ASL.
While each of these deals has its own rationale, the broader trend is clear. As the fintech market continues its rapid expansion, competition is heating up and a period of consolidation is all but inevitable. As a result, we have seen over two dozen deals in the first quarter, and anticipate the trend to continue as we move into the second half of the year.
Denise Johansson, co-founder and co-CEO at payment processor Enfuce, views the underlining reason for this dealmaking frenzy as boiling down to simple unit economics. “Companies are looking at their books and realising it is sink or swim,” she tells EMEA Finance. “If they can’t turn a profit in the next 18-24 months, they need to find a partner to survive.”
Why founders are looking to exit
Between 2023 and 2030, global fintech revenues are expected to surge from US$245bn to US$1.5tn, according to Boston Consulting Group. That represents 7% of total financial service revenues, a giant leap up from just 2% in 2023.
Although funding has been thin on the ground these last few years, with VCs deterred by high interest rates, many firms either had sufficient cash or registered revenue and profit growth to keep them afloat. Having navigated the early start-up phase, they have reached break-even or profitability – and now they are catching the eye of would-be acquirers.
“What's interesting is the nature of these courtships and who's pairing up. In the early 2020s, the smart money was on established banks and incumbent players buying fintechs to cover gaps in their service or product portfolios.
Fast forward to 2025 and it's now fintechs tying the knot with other fintechs,” says Johansson.
From the perspective of the smaller partner, this union has many advantages. With the fundraising market still relatively stagnant, they may struggle to achieve their desired growth and expansion through other means. Victor Basta, managing partner at Artis Partners, has called for midsize fintechs to begin their exit planning phase, remarking that founders are on course for record exit values.