The UK accounted for over half of the total European fintech investment, according to the KPMG Pulse of Fintech report.
The report states that the UK’s contribution to European investment stood at $7.4 billion, with the UK accounting for 14% of the global total, which came in at $31 billion, the same level of investment as 2016.
Anton Ruddenklau, partner & head of digital & innovation, financial services, KPMG in the UK, said:
“The UK’s fintech market remains remarkably resilient. The final quarter of 2017 saw the most deal activity since 2014, largely driven by payment companies. As we enter a world of open banking,
“I expect that to continue. Large financial institutions still have deep investment pockets, the big banks want to get involved in fintech and acquire start-ups to help meet their growth ambitions. We’re likely to see more purchasing than investment through 2018.”
London continues to act as the magnet for the UK with several large deals, including TransferWise’s $280 million VC funding round and Trayport’s $727 million acquisition, providing a significant boost to the UK’s total investment.
Rachel Bentley, specialist with KPMG’s innovative start-ups practice in London, added: “London was one of the earliest fintech innovation centres so it now has a large number of mature businesses with good traction in the market, clear paths to profitability, and strong value propositions for investors.
“This maturity has helped the UK market to remain resilient in an uncertain economy and later stage investment definitely helped to boost the numbers in the final quarter. At the same time, a positive regulatory climate and strong fintech ecosystem continues to attract new start-ups and we are also seeing earlier stage activity across the sector, reflecting the diversity of the UK market and a positive sign for future investment.”