UK fintech investment grows despite global slowdown
Investment in UK fintech grew by 24 per cent in the first half of this year, while global fintech investment flatlined.
According to the latest fintech investment report from Innovate Finance, $59bn (£49.13bn) was invested in fintech globally during the first half of 2022 – the same amount that was invested during the first six months of 2021.
But in the UK, fintech investment reached $9.1bn, representing a 24 per cent year-on-year increase on the first six months of last year.
This follows a record breaking 2021, which saw rising fintech values across the board. Earlier this year, Innovate Finance reported that fintech investments in the UK increased by 217 per cent in 2021 to reach an all time high of $11.6bn, while global fintech investments reached $102bn – a 183 per cent increase on the previous year.
Innovate Finance noted that a market correction started to become apparent in April 2022, as venture capital investments started to slow down amid rising interest rates.
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However, venture capitalists said that despite this temporary slowdown, investors are still keen to invest.
Janine Hirt, chief executive of Innovate Finance, pointed out that UK fintechs are still performing well, with fintech investment in the UK second only to the US globally. The UK also holds its spot as the top European fintech hub, with Germany and France coming in at a distance second and third place.
“It is fantastic to see that UK fintechs are continuing to secure outstanding levels of investment – this is a testament to the strength of our ecosystem, including our innovative entrepreneurs and founders, strong and diverse talent pool, and a supportive government and regulatory framework,” said Hirt.
“It is critical that we now keep up this momentum. The UK is currently receiving more investment in fintech than all of Europe, second only in the world to the US. We must continue to work together – industry, government and regulators – to build on this leadership and ensure the UK remains the best place in the world to start, build and scale a fintech business.
“This will positively impact not only the financial services sector but the entire population of the UK as a whole who will benefit from new, innovative, and more effective products that drive greater financial wellness.”
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