Significant decline in investments in German fintechs

The German fintech market saw a significant decline in investment activity in the second half of 2025. This is according to the latest edition of our biannual report, “Pulse of Fintech”.  The total funding volume from venture capital, private equity and M&A fell to US$277 million – 60 per cent below the first half of 2025 and 76 per cent below the same period last year. At the same time, the number of transactions fell to 49 deals. The fourth quarter was particularly weak, with just US$64 million invested – around 70 per cent less than in the previous quarter. 

An international comparison reveals a mixed picture: in France, investment volume slumped to US$331 million in the second half of 2025 – a 52 per cent drop compared to the first half. The UK, by contrast, recorded a significant increase compared with the first half of the year (+131 per cent), with US$7.6 billion and 179 transactions; however, this primarily represents a stabilisation following a weak start to the year. 

In Germany, venture capital remains the primary source of funding in the absence of major private equity or M&A transactions, but is clearly losing momentum. The growing reluctance of corporate investors is striking: corporate venture capital investment in German fintechs amounted to US$49 million in the second half of 2025, around 70 per cent below the previous year’s figure. 

At the same time, artificial intelligence continues to gain structural importance. In the EMEA region, AI-related business models accounted for 36 per cent of all fintech transactions in the second half of the year. In Germany, the share stood at 31 per cent (16 transactions). Investors are increasingly focusing on AI solutions with concrete operational benefits, such as improving efficiency, automation and better data utilisation.