Fintech companies in the UK attracted more than double the investment than the previous year, according to a report released on Thursday by Innovate Finance, the British fintech trade association.
Whilst investors have raised concerns over the UK economy following the Brexit vote, Britain’s fintech sector is booming. Companies raised over £1.29 billion) in venture capital investment in 2017, up more than 150% from the £505 million raised in 2016. The surge in fintech investment contrasted strongly with the 18% decline in global fintech investments to $14.4 billion. The increase in fintech investment into British firms saw the UK move ahead of China to take second place in worldwide investment, just behind the USA, which saw $7 billion of VC money invested into its fintech sector, topping the table once again.
UK Boost in Fintech Investment
The fintech industry in the UK has blossomed with the insurance sector and the loan and debt consolidation sectors. Advancements in technology, the rise of blockchain technology and the willingness of investors to back fintech projects have all combined to make Fintech emerge as one of the UK’s fastest growing industries in the years following the financial crisis of 2008. In the UK, the fintech sector is believed to be worth over £7 billion and employing upwards of 60,000 people.
Despite all the talk of Brexit and the possible shortage of skills it would leave the UK, London has become, alongside Singapore and Israel, a fintech hub. In Israel, the joke is that new immigrants no longer have to learn hebrew to get along, they have to learn coding. However, fintech is booming outside of London too. Leeds, Manchester, Edinburgh, and Glasgow are all experiencing rapid growth in their fintech industries.
Fintech in the UK was boosted by a few large fundraisings totalling more than $90m. The largest fundraising by far was by TransferWise, a cross-border payments provider, which attracted $280m in investment. OakNorth, a digital lender to small businesses, came second, raising $203m in investment. The next three biggest fundraisings in the UK were by Funding Circle, a P2P lender to small businesses; Interactive Investor, an online trading platform; and Monzo, a mobile banking app. In total, 45 per cent of investment in UK fintechs went to digital banks, foreign exchange providers and money transfer operators, with blockchain technology leading the way .
On Wednesday, a separate report released by research firm Beauhurst revealed that equity investment in UK start-ups and high-growth firms in all sectors also more than doubled in 2017 to £8.3bn.
Jacob
Latest posts by Jacob (see all)
- Why I Ditched Google for PrivacyWall and You Should Too - April 13, 2021
- 7 Reasons Why Privacy is Critical in Coin Collecting Software - September 22, 2020
- Andrew Anastasiou Launches LegionPay - August 13, 2020