Investment in Canadian fintech in the first half of the year was down but not out amid heightened economic uncertainty, based on KPMG International’s bi-annual fintech report.
A total of US$1.62 billion was invested in Canadian fintechs across 60 deals — including venture capital (VC), mergers and acquisitions, and private equity — in the first half of 2025. That’s down from a record US$7.5 billion in the second half of 2024 — a fourfold drop — based on data compiled by PitchBook for KPMG International.
However, last year’s record high was driven by a couple of large deals, so this year’s investment activity represented more “stable” levels, Dubie Cunningham, partner, banking and capital markets with KPMG in Canada, said in a release. “In fact, when you consider the economic shifts such as tariffs affecting global trade, investment in the first half was quite robust compared to historical levels,” Cunningham said.
Globally, US$44.7 billion was invested across 2,216 deals in the first half of 2025.
While Canada accounted for 2.7% of the global fintech deal count and 3.7% of total disclosed value, the country punches slightly above its weight on deal size and late-stage/buyout presence, said Edith Hitt, partner with KPMG in Canada, in the release. Hitt leads the digital financial services transformation team in Quebec.
The largest deal in Canada — and eighth largest globally — was the US$916.5-million (C$1.3-billion) buyout of Gatineau, Que.–headquartered IT consulting firm Converge Technology Solutions Corp. by H.I.G. Capital, a Miami-based private equity firm.
Fintechs in the digital assets and artificial intelligence (AI) spaces attracted the majority of investments, which has been a continuing trend.
Hitt said one of the “most notable and exciting trends” for investors to watch in the year ahead is the potential for agentic AI in the Canadian fintech landscape. Agentic AI is capable of autonomous decision-making and actions, and potential use cases include automated saving, budgeting and investment.
Financial planning for the win in VC
Within VC specifically, investment dropped more than 40% in the first half of 2025 compared to the prior half-year. However, financial planning was well represented, given the largest investment went to Winnipeg, Man.–based Conquest Planning Inc.
The financial-planning platform’s $110-million Series B financing in June was the largest VC investment in the first half.
Overall in the first half, VC investors put US$498 million into 45 Canadian deals amid fallout from the U.S. trade war, compared to US$864 million across 40 deals in the second half of 2024.
VC activity could bounce back in the second half of 2025, depending on measures in the upcoming federal budget.
“Looking ahead here in Canada, investors will likely be watching for potential federal funding announcements for innovative startups and growth companies in the [new Liberal] government’s first budget this fall,” Cunningham said in the release.
As things stand, the government is catching up on the implementation of previously announced tax-related measures aimed at business and innovation. On Friday, the Finance Department released draft legislation for enhancements to the scientific research and experimental development program and an extension of the accelerated investment incentive. At the same time, draft legislation was released for expanding the capital gains rollover on business investment. Earlier this year, Finance also released draft legislation for the electric vehicle supply chain investment tax credit.
These measures were all announced in the fall economic statement, and the current Liberal government is expected to move forward with other previously announced clean energy tax credits.