Dive Brief:

• British payments software company Revolut captured the most venture capital of any paytech startup during the third quarter in a round that was among the biggest in the world, according to a third-quarter venture capital report from research firm CB Insights. Revolut, which provides mobile app financial tools, raised $800 million in July in a fundraising round co-led by New York-based Tiger Global Management.
• Other private paytech companies with noteworthy fundraising campaigns during the quarter included Nigerian mobile payments enterprise OPay raising $400 million in August; Wave Financial, another fintech mobile payment apps firm focused on Senegal, raising $200 million last month; and Scalapay of Ireland, a buy now-pay later firm also attracting money from Tiger Management when it raised $155 million last month. 
• In the U.S., only payments player SpotOn reported a significant haul, landing $300 million last month just months after raising $125 million in June. The San Francisco-based company targets its payments software applications at small and mid-sized restaurant and retail enterprises.

Dive Insight:

The fintech boom is happening worldwide and in the U.S., with a major assist from capital flowing to upstart payments companies, according to the CB Insights report published last week. Worldwide venture funding climbed to a quarterly record of $158.2 billion during the third quarter, more than doubling the total during the same period last year, and increasing 1% compared with the second quarter record set earlier this year, the research firm said.

The billions of dollars in venture capital flowing to payment startups comes as consumers and businesses move away from cash and paper-based money flows to digital alternatives. A slew of payments startups are egging on the transformation and bringing new competition to big established banks and legacy payments companies by pitching new digital tools that are often cheaper and easier to use. As a result, they've been attracting record amounts of capital from investors eager to benefit from a new era.

While the rising tide lifted all boats, startups in Asia attracted a larger share of the increase during the quarter than did U.S. companies. Venture funding to U.S. companies rose about 3% to $72.3 billion while those in Asia drew an additional 18% to pull in $50.2 billion. Among the paytech companies in Asia that benefited during the third-quarter was the Indian payments software company Pine Labs, which raised $100 million last month.

Still, when it came to payments startups absorbing money, Europe was a standout, even though venture capital flowing to the continent overall ebbed 20% compared to the second quarter. The capital windfall for Revolut was the 8th largest in the world, giving that London-based company a $33 billion valuation.

In addition, another British mobile payments software company Zepz, formerly WorldRemit and also headquartered in London, attracted $292 million in August. Finally, London-based payments infrastructure software company Form3, backed by U.S. investment bank Goldman Sachs, also collected $160 million in venture funding last month.

Canada was also a winner in the third quarter. Two of the country's biggest capital hauls were in the payments category, including $210 million raised by Bitcoin software and services company Blockstream and $120 million raised by point-of-sale tech company PayFacto Payments, both in August.

Overall, fintech companies, including those focused on payments technology, have played a starring role in the funding bonanza. The $91.5 billion collected by the fintech category so far this year is already almost double the amount last year, with another quarter yet to go this year, according to the CB Insights report.

The fintech group also boasts more unicorns, which are privately-held startups valued at more than $1 billion, than any other category, the report said. There were 200 fintech unicorns worldwide at the end of the third-quarter, including 42 that emerged during the quarter, making up about a third of all unicorn new arrivals. 

The top paytech unicorns include payments processing company Stripe, with dual headquarters in Ireland and the U.S., Swedish buy now-pay later enterprise Klarna and Revolut, respectively.