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Peer2Peer Finance News | July 23, 2017

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UK fintechs shrug off Brexit as investment soars

UK fintechs shrug off Brexit as investment soars
Suzie Neuwirth

FINTECH investment between the UK and mainland Europe surged to a two-year high in the first quarter of 2017, shrugging off political uncertainty across the region.

Research from accountancy firm KPMG found that mainland Europe provided $212m (£164m) to UK fintech start-ups in the first quarter, the highest sum since the third quarter 2015. Meanwhile UK investors channelled $428m into venture capital financing of start-ups in continental Europe, by far the largest number since 2014.

UK fintechs also appear to be firmly back on US investors’ radar, with US venture capitalists supporting them to the tune of $192m during the first three months of the year. This exceeds the total amount invested throughout the whole of last year ($128m). 

Read more: Funding Circle’s Desai among confirmed speakers at Fintech Week 2017          

“It’s clear that any uncertainty around the impact of Brexit seen in 2016 has, for now at least, dissipated,” said Patrick Imbach, co-head of KPMG’s tech growth practice.

“It’s especially promising to see such a healthy level of mutual interest between the UK and Europe in light of the hectic political agendas on both sides of the channel.

“Global investors may see value here given the depreciation of the pound, or they may simply be reassured by the level of innovation and regulatory support for start-ups happening in the UK. Regardless of the cause, the start of 2017 holds promise for UK fintech.”

The UK remains the dominant fintech force in Europe, the research found, accounting for half of the top 10 investments – which include peer-to-peer lender Funding Circle’s successful $100m fundraising in January.  

The UK government has been making efforts to boost international investment into the fintech sector. Earlier this month, it held its first international fintech conference in London, as part of the second annual UK Fintech Week, to showcase the sector’s wares to the rest of the world.

Read more: Hammond underlines importance of fintech for UK economy