London-based fintech companies have increased their funding from venture capital investors in the first six months of this year compared to any year in the past signaling the British capital’s resilience as a fintech hub post-Brexit.
nvestors have sunk $5.3 billion into London fintech startups in the first half of 2021. compared to $2.1 billion in the same period last year, as per data from research firm Dealroom and London & Partners.
The booming fintech scene in London comes midst global lockdowns which have driven companies across the globe to adopt digital financial services, including payments and trading.
Between January and June fintech companies have raised $54.1 billion across the globe, overtaking the total amount secured in the two previous years.
Incidentally, London fintechs accounted for a large share of Europe’s growth, representing over a third of the region’s funding.
According to the research data, the city of London ranked second behind San Francisco and slightly ahead of New York.
According to local entrepreneurs and investors, the figures showed that London could remain a leading fintech hub even after Brexit and the massive economic fallout of the COVID-19 pandemic.
“Today’s investment figures are a vote of confidence for the UK fintech sector,” said Anne Boden, CEO of neobank Starling.
Starling was among the top London fintechs to secure a major funding round this year, raising $444.88 million (322 million pounds). Other large funding rounds includes $478 million for payments firm SaltPay and $450 million for payments unicorn company Checkout.com.
Despite this, there are growth concerns stemming from Brexit, especially around access to talent and licences.
“The loss of passporting after Brexit means that licensing and international expansion is no longer easiest in London,” said Charles Delingpole, CEO of startup ComplyAdvantage. “London therefore has to move to a higher value added model focused on a global rather than European hub role.”
Wise shares opened at 800 pence on its London Stock Exchange debut on Wednesday, giving it a market capitalisation of 7.95 billion pounds, well above market expectations from earlier this year.
($1 = 0.7238 pounds)