Fintech investors focused on the artificial intelligence, machine learning, and digital assets sectors in 2025, according to the “Pulse of Fintech H2’25 and FY25” report published by KPMG International.
Kareem Sadek, KPMG Canada’s national technology risk services leader, pointed to enhanced data governance practices and regulatory guidance as factors boosting investor confidence in AI-focused fintechs.
“We’re seeing a rapid acceleration of investor interest in AI-focused fintechs, driven by the sector’s ability to unlock efficiencies and create new value through automation and advanced analytics. As financial institutions modernize their operating models, they’re looking for scalable AI solutions that don’t just streamline processes, but fundamentally reshape how decisions are made,” Sadek said in a statement. “With stronger data governance practices and rapidly maturing regulatory guidance, investors now have greater confidence that AI fintechs can deliver transformative impact in a controlled and responsible way, and that will accelerate investment in AI.”
Digital assets recorded the highest number of investments for the fourth straight year. Sadek noted that the GENIUS Act’s passage in the US bumped cryptoasset-oriented fintech investments; moreover, the Canadian federal government’s stablecoin regulatory regime improved regulatory clarity, transparency, and investor protection while aligning Canada’s digital assets ecosystem with established global financial standards.
“As Canada’s new stablecoin regime starts taking shape in 2026, we expect a significant uptick in investor interest across the digital asset ecosystem. Clear standards for stablecoin issuance and reserve management reduce regulatory ambiguity and open the door for broader adoption of blockchain based payments, tokenized assets, and other enterprise grade digital asset solutions,” Sadek said in his statement. “With enhanced regulatory certainty, digital assets are positioned to become a bigger part of investors’ fintech portfolios.”
Other sectors that saw steady investment activity were ESG and greentech-focused fintechs, regtechs, payments fintechs, insurtechs, and proptechs. However, investors were picky with cybersecurity and wealthtech organizations.
The “Pulse of Fintech H2’25 and FY25” report revealed that fintech investment in Canada over 2025 moderated compared to the previous year. Pitchbook data revealed that investments in venture capital, private equity and mergers and acquisitions totaled US$2.4 billion.
“The investment appetite for Canadian fintechs will continue to grow in 2026, as investors prioritize quality, scale and strategic fit, signalling a market that is maturing and aligning more closely with longterm value creation,” said Dubie Cunningham, KPMG Canada banking and capital markets partner.