The UK fintech sector has been a glittering success in recent years, as London’s status as a global financial hub made the country a magnet for dynamic startups. Digital challenger banks such as Starling, money-transfer services such as Wise and investment apps such as Nutmeg have attracted billions of pounds in investment.
But, with the economic outlook deteriorating both at home and abroad, the market’s shine has faded fast this year. The prospect of stagflation over the coming months is hitting investor confidence in hi-tech industries particularly hard.
The combined equity investment raised by British fintech firms plunged from £2.13bn during Q2 2022 to £491m in Q3, according to research published by Beauhurst and Deloitte.