The UK has topped the chart in attracting the most FinTech investment across Europe, receiving over US $ 37. 3 billion.
As per KPMG’s “Pulse of FinTech H1’21,” UK-based financial enterprises have received nearly US $ 37.3 billion, seven times more when compared to 2020. Britain has surfaced to become the hub for FinTech investment in post-Brexit, grabbing over 600 M&A deals, venture capital and private equity deals that have been finalized in 2021, which is more than 27% compared to 2020.
The total FinTech investment witnessed this surge due to a series of high-value deals, having five of the ten largest FinTech deals in the EMEA region completed in the UK, with London attracting more FinTech investment than the rest of Europe.
The UK stood at the forefront of the European FinTech scene. The EMEA region drew US $ 77 billion in FinTech investment in 2021, with Germany attracting a record level of funding, receiving US $ 5.4 billion and Ireland attracting US $ 1.6 billion of investment.
The UK’s economic growth has been substantially dependent on FinTech, and it is crucial that the ongoing work fosters FinTech firms if the UK wants to remain attractive prospects for investment.
Across the globe, investment in FinTech has been popular. In fact, as per KPMG’s report, FinTech funding across M&A, Venture Capital, and Private Equity reached as much as US $ 210 billion with a record 5,684 deals last year. It shows that payment continues to attract the most funding, with US $ 51.7 billion in investment in 2021 with an increasing interest in sectors such as “buy now, pay later” that embeds banking, open banking helping to keep the industry “robust”.
As per Anders la Cour, CEO, Banking Circle, “Almost a year ago, the Kalifa report revealed that the UK was at risk of losing its trailblazing position in the FinTech world.” He adds, “fast forward twelve months and FinTech investment topped an impressive £27.5bn, demonstrating that the UK has held firmly onto its crown. This is a massive win for not just the UK but Europe and the rest of the world. This sort of investment drives competition and innovation forward.
Digital transformation in Financial Services is currently at a tipping point, with technology being used to empower Banks, Payments businesses, and Financial Institutions all over the globe. KPMG’s latest data proves that this trend is set to carry on in 2022, so it’s a fascinating time to be in FinTech right now. In particular, the likes of Buy Now Pay Later, Request to Pay and using emerging technology such as AI are set to define the year ahead. What’s more, the collaboration will be an essential tool for future-proofing FinTechs and FIs. Indeed, recent research found that 65% of CIOs at Banks and FinTechs expect to use partnerships to supercharge businesses this year.”
“While the UK’s FinTech sector continues to get popular, certain payment methods have raised concerns with the UK” s financial authority, which is consulting on establishing new rules for “buy now pay later” schemes,” adds Anders la Cour.