After stalling in 2022 and 2023 amid rising interest rates, tighter funding conditions, and heightened regulatory scrutiny, the fintech mergers and acquisitions (M&A) market is reopening, with transaction volume expected to rise from US$25 billion in 2024 to US$40-60 billion over the next 24 months.

According to Luciano Colos, CEO and co-founder of PitchGrade.com, an AI-powered research platform for entrepreneurs to create and refine pitch decks, this growth will be driven by consolidation in the banking-as-a-service (BaaS) industry, demand for regtech solutions, and payment modernization efforts.

BaaS consolidation

In a new analysis, Colos looks at the state of fintech M&A in 2026 and shares predictions for what to come for the state through 2027. He names consolidation in the BaaS sector as one of the most likely transaction themes in 2026 and 2027, driven by distressed valuations among players who struggled in 2023 and 2024.

These players included Synapse, which filed for chapter 11 bankruptcy protection in 2024, Blue Ridge Bank, which terminated consent orders in 2025, and the Evolve Bank data breach in 2024, which forced the company to pay US$11.9 million in settlement for a class action lawsuit.

This wave of failures created a category-wide credibility problem. As a result, acquirers are picking up infrastructure at a discount. At the same time, the BaaS companies that survived face tougher regulations where having a large size and capital is essential for survival.

According to Colos, the most promising targets in this category include Unit, Column, and Increase.

Unit is a leading US embedded finance startup offering ready-to-launch solutions that help software companies transform into “money hubs” for their customers. It claims more than 100 business customers, including Wix, Bill.com, Honeybook, Relay, and Homebase, serving over 2 million end customers.

Column is an American chartered bank that provides regulated financial infrastructure for companies innovating in financial services, serving clients include Carta, Brex and Ramp. It claims to power as much as 40% of all money moving across the Bay Area’s tech industry, doubling its revenue to US$200 million in 2025, with free cash flow of more than US$100 million, or about US$1 million per employee.

Finally, Increase provides banking infrastructure that lets fintech startups and businesses move money, store deposits and access payment rails without building direct bank connections. It processes hundreds of billions in payments volume per year.

Well-capitalized processors, like Fiserv and FIS, as well as banks such as JP Morgan and US Bank, are the most likely buyers in the BaaS platform consolidation.

Regtech growth

AI-native compliance and know-your-customer (KYC) solutions are another key theme in 2026 and 2027. As Bank Secrecy Act and anti-money laundering (BSA/AML) requirements expand, regtech is entering a growth phase.

Companies like Alloy, Sardine, and Resistant AI represent a new generation of compliance infrastructure, setting a new standard that incumbents must need to remain competitive.

Alloy provides an identity and fraud prevention platform that enables global financial institutions and fintech startups to manage identity risk, serving more than 700 of the world’s largest financial institutions and fintech companies. It’s valued at US$1.55 billion, and is a natural target for well-capitalized processors like FIS or Fiserv to bundle advanced compliance capabilities with their core banking offerings.

Sardine offers an agentic risk management platform, unifying data across risk teams to detect fraud in real-time and streamline compliance operations. It has protected over US$1 trillion in transaction volume for 503 million consumers and 2.6 million businesses to date, serving companies including FIS, GoDaddy, Deel, Checkout, and Brex.

Finally, Resistant AI is a provider of native AI models for financial crime and fraud prevention. Resistant AI claims that companies using its services see a 3x increase in document fraud prevention, 5x faster review times, 90% automation rates, and a 5x increase in second-line analyst productivity. It serves customers including Dun & Bradstreet, Payoneer, Close Brothers, AXA, PennyMac, Bank of Valletta and Finom. Resistant AI raised US$25 million in a Series B in October 2025 after breaking even.

Colos expects two or three significant acquisitions in this category in 2026 and 2027 at 6-10x annual recurring revenue (ARR) multiples.

B2B payment infrastructure

Another key fintech M&A theme in 2026 and 2027 is international payment infrastructure. With business-to-business (B2B) cross-border payments remaining expensive, slow and fragmented, acquirers with global ambitions will continue to buy payment rails and local infrastructure, especially those operating in high-growth markets, like Latin America (LatAm), Southeast Asia, and Africa.

Most likely buyers include Mastercard, Visa, Block and Stripe, with probable targets that encompass Rapyd and Nuvei.

Rapyd is a cross-border payment and embedded finance infrastructure serving 250,000 merchants. At its 2021 peak, Rapyd was valued at US$15 billion but has since seen its valuation shrink to US$4.5 billion, according to reports.

Nuvei offers a modular, flexible and scalable technology that allows companies to accept next-generation payments, offer various payout options, and benefit from card issuing, banking, risk and fraud management services. Nuvei supports customers in more than 200 markets, with local acquiring in 50 markets, 150 currencies, and 680 alternative payment methods

Nuvei was privatized in 2024, and is now owned by a private equity firm. The company could be re-sold or become a merger target.

Colos also expects a number of B2B payment transactions focused on the US market. With the RTP and FedNow networks now operational, the plumbing for instant B2B payments is in place. This will likely prompt strategic buyers like Fiserv and FIS, as well as ERP providers like SAP and Oracle, to accelerate acquisitions of software layer above that infrastructure.

Colos expects a particular focus to be placed on solutions that enable treasury management, payment orchestration, and accounts payable automation over real-time rails.

Fintech M&A rebounds

After stalling in 2022 and 2023, the fintech M&A market rebounded in 2025 as incumbents became strategically motivated to acquire distribution and technology. Targets are now those with proven revenue and clear integration rationale, rather than high-growth loss-makers.

Valuation multiplies, while recovering from 2022-2023 lows, reflect a new equilibrium. Payment infrastructure are now trading at 3-7x revenue, neobanks at 2-4x, and data and compliance platforms at 5-8x. This marks a significant recalibration from 2021, when fintech companies traded at 20-40x revenue multiples, valuations that made most targets unacquirable.

Globally, the fintech industry recorded 1,030 M&A transactions in 2025, reaching a four-year high and climbing 29% year-over-year (YoY) from 797 deals in 2024.

The largest transactions last year included Dunamu, the company operating South Korea’s largest cryptocurrency exchange Upbit valued at US$10.3 billion and acquired in November 2025 by Naver Financial; Melio, a US-Israeli payment firm valued at US$3.1 billion and acquired in July 2025 by New Zealand’s cloud accounting software giant Xero; and Deribit, a crypto options exchange valued at US$2.9 billion and acquired in August 2025 by US crypto firm Coinbase.

Featured image: Edited by Fintech News Switzerland, based on image by funtap via Freepik