Despite an overall rise in startup investments, the fintech sector saw a 33% drop in funding last year. While digital lending platforms continue to dominate in terms of attracting capital, the next wave of innovation is emerging in AI-driven financial infrastructure. According to Kabir Narang, founding general partner at B Capital, the investment landscape in fintech is shifting. “While lending remains a key part of the ecosystem, it is increasingly a balance-sheet-heavy play, making it more suited for private equity and structured credit investors."