Canadian fintech funding reached $1.62 billion in the first half of 2025, KPMG Canada reported in its Pulse of Fintech survey. Digital asset platforms and AI-driven financial tools captured the bulk of new venture capital flows, underscoring investor confidence in emerging technologies.
Despite a global slowdown in fintech investments, Canada maintained steady capital deployment in blockchain-based infrastructure, DeFi protocols and AI analytics platforms. The $1.62 billion raised represents a year-over-year decline from $2.4 billion in H1 2024 but exceeds the $1.5 billion mark associated with similar downturn periods.
KPMG Canada’s analysis identified infrastructure projects, onchain payment rails and tokenization platforms as leading growth segments. Investor demand was buoyed by constructive regulatory developments in the United States, including clearer stablecoin guidelines and the dismissal of high-profile legal challenges to major crypto firms.
The report highlighted a thematic shift toward revenue-generating business models. Established fintech providers specializing in treasury management, compliance frameworks and real-time payment settlement secured follow-on funding from institutional participants.
AI integration emerged as a key driver for fintech innovation. Solutions leveraging machine learning for fraud detection, credit scoring and personalized financial advice attracted significant capital, signaling robust market appetite for AI-enabled services.
Regional distribution of funding showed robust activity in hubs such as Toronto, Vancouver and Montreal. Cross-border partnerships, particularly with U.S. venture firms, provided additional syndication opportunities and access to larger funding pools.
Stakeholder interviews conducted by KPMG Canada revealed that dry powder reserves are sizable, with investors seeking late-stage and growth-equity opportunities in fintech. This pipeline of available capital is poised to support emerging scale-ups and facilitate strategic acquisitions.
Macro factors such as rising interest rates and global trade tensions contributed to cautious investor sentiment. However, the convergence of crypto and AI narratives has strengthened deal flow in adjacent sectors, offsetting broader market headwinds.
Looking ahead, KPMG Canada projects sustained investment momentum in the second half of 2025, driven by continued U.S. regulatory support, expansion of AI applications and ongoing maturation of blockchain use cases.
The report forecasts that total fintech investment could surpass $3 billion by year-end, marking one of the strongest annual outcomes for Canada’s fintech ecosystem. Continued institutional engagement and supportive policy frameworks are expected to underpin this trajectory.
Investors and entrepreneurs will watch developments in stablecoin regulation, AI policy and cross-border venture activity to calibrate strategic priorities. The evolving landscape presents opportunities for collaboration across sectors and geographies, reinforcing Canada’s position as a leading fintech market.
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