Fintech and Billion-Dollar Deals Drive Resilience in Q3 for Financial Services: Report

India’s financial services sector saw 61 deals worth $7.8 billion, according to the Grant Thornton Bharat Q3 2025 Financial Services Dealtracker, marking a 23 per cent drop in deal volume but a 39 per cent increase in value, the highest quarterly value since Q1 2024. The growth was driven by three billion-dollar transactions, including Sumitomo Mitsui Banking Corporation’s $1.3 billion stake in Yes Bank, HDB Financial Services’ $1.5 billion IPO offering and QIP by SBI, reflecting continued institutional confidence during Q3. 

Fintech also stood out, attracting private equity interest in AI, digital payments, and automation, highlighting the sector’s resilience amid global uncertainty. The deal volume stood at 26 (47 per cent share, $409 million) with predominantly small-ticket transactions (less than $50 million, 96 per cent of deals). Volumes and values saw a drop of 33 per cent and 38 per cent respectively versus Q2 2025.

Speaking on the Q3 deals, Vishal Agarwal, Partner, Private Equity Group and Deals Tax Advisory Leader, Grant Thornton Bharat, said the quarter reflects the current dichotomy in India and global markets. 

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“While overall deal volumes softened, long-term strategic investments, uptick in QIP and IPO activity and fintech innovation highlight sustained investor confidence. Domestic reforms such as GST rationalisation could boost consumption, rethinking acquisition financing by banks and supportive measures for fintech will be key to driving the sector’s growth trajectory,” he said.

The quarter recorded 17 M&A deals worth $1.5 billion, marking a slight 6 per cent increase in deal volumes but a sharp 44 per cent decline in deal values compared to the previous quarter, largely due to the absence of large-ticket transactions. 

The previous quarter was buoyed by three high-value transactions totaling $2.4 billion (94 per cent of M&A value), whereas this quarter saw only two such deals worth $1.3 billion, which accounted for 91 per cent of total M&A value; without which, deal values would have fallen dramatically. 

In the private equity landscape, Q3 saw 38 PE/VC deals of $1.2 billion, reflecting a 33 per cent decline in volumes and a 37 per cent drop in value compared to the previous quarter. The funding landscape was dominated by early-stage, Series A and B investments, largely aimed at supporting geographic expansion. 

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Only four high-ticket transactions above $100 million were recorded, together contributing $729 million, while smaller deals below $50 million accounted for 83 per cent of deal volume but just 29 per cent of total value, highlighting a market skewed toward modest-sized investments amid cautious investor sentiment.

However, there was a strong rebound in public market activity during the quarter, with 3 IPOs raising $2 billion and 3 QIPs totaling $3.1 billion. While IPO volumes picked up after a muted Q2, QIP volumes halved, though values surged nearly 2.8x, reflecting robust investor appetite for large-scale capital raising.