A report on Thursday indicated that last year, Indian fintech startups raised $5.65 billion in 390 rounds, a significant decrease of 47% in terms of funding amount and 29% in the number of rounds when compared to the previous year.

According to data from global software-as-a-service (SaaS) based market intelligence platform Tracxn, the decline in funding can be attributed to a decrease in late-stage funding from $8.3 billion in 2021 to $3.7 billion in 2022, a drop of 56%.

Fintech startups recorded a significant decrease of 50% in funding rounds of $100 million or more in value, with only 13 such rounds recorded in 2022, compared to 26 rounds in 2021.

According to the report, Y Combinator, Tiger Global Management, and Lets Venture were the most active investors in the fintech space, with each making more than 20 investments in 2022.

According to the report, only four startups in India’s fintech sector reached unicorn status in 2022, a significant decrease compared to the 13 new unicorns in 2021. Additionally, the report also highlighted that among the cities, fintech companies in the Delhi-NCR region (Delhi, Noida and Gurugram) have raised a combined funding of $14.9 billion till date, followed by Bengaluru ($10.2 billion) and Mumbai ($4.2 billion).

According to the report, India is still the third-highest funded country in terms of funding received in the fintech sector, only behind the US and the UK. The report stated that “The country is currently experiencing a funding winter. Growing inflation and macroeconomic tensions have made the investors step back from making big investment decisions.”