This year, global fintech funding is flowing towards scaled banking startups competing directly with traditional banks, as well as digital asset companies despite overall funding volumes continuing to contract, according to new data released by CB Insights.

In Q1 2026, late-stage deal share in banking reached 35%, more than twice the quarterly average of 2024-2025. At the same time, total banking fell to a multi-year low of 34, and total funding dropped to US$934 million, roughly half of US$1.8 billion raised during the same period last year.

Of the capital still entering the banking vertical this year, funding is concentrated on…