In a recent report published by Innovate Finance, the company noted that the United Kingdom fintech sector witnessed 24% growth in investments during the first half of 2022 as the number touched $9.1 billion.
With 3,046 deals, the international fintech sector saw investments worth $59 billion. The US remained the top destination for leading venture capital firms as American fintech startups attracted $25 billion worth of investments.
The UK came in second followed by India, Germany and France. Compared to the first quarter of 2022, the overall fintech investments decreased in Q2.
“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,” Janine Hirt, the CEO of Innovate Finance, said.
Challenging Environment
Amid a sharp dip in the valuation of fintech giants like Stripe and Klarna, the sector is going through one of its worst phases. Investments across the US financial technology sector dipped almost 10% in the first half.
“Internally, we get insights as to what’s happening in public markets. We look into publicly available data for equities and fixed income and assess early signals of the market overheating, which we started to see in December 2021. We saw signals of a correction of the public markets not only on the tech side but public equities due to overvaluation,” Erik Mostenicky, the Vice President at Fidelity International Strategic Ventures, said.
