According to new research based on Pitchbook data released by London & Partners, and Innovate Finance, London has now overtaken New York in attracting the largest amount of fundraising deals for FinTech companies. The English capital’s FinTech sector attracted a total of 114 deals worth a record $2.1 billion in the first eight months of 2019. These figures further prove the strength of the United Kingdom’s thriving FinTech industry, which generates revenue of £6.6bn per year. But why does the UK stand at the top of the pile?
There are estimated to be over 1,600 FinTech firms in the UK, and this is expected to more than double by 2030. When it comes to debt collection, FinTech debt collection companies, such as LATERAL, have revolutionised a formerly dated industry. And this is an important reason behind the UK’s winning position. By introducing vastly improved rent recovery rates and an improved business experience for both creditor and debtor as a whole, the debt recovery sector has continued to thrive.
Another important statistic (released by The Department for International Trade in May of 2019) found that the majority of financial services CEOs in the UK (62%) believe that a focus on emerging technologies is “the number one driver that will separate high-performing firms from the rest”. And British digital tech companies are the most connected in Europe, “second only to Silicon Valley for international connections. 25% of entrepreneurs across the world report having a significant relationship with two or more entrepreneurs in London, compared to 33% for Silicon Valley”.
The UK regulatory environment is also welcoming when it comes to FinTech, and the UK’s regulators are often pointed to as one of the key facilitators of the UK’s position as a global industry leader. Lawrence Wintermeyer, CEO of Innovate Finance, believes the UK government has led the way with progressive policy, citing the Financial Conduct Authority’s (FCA) Project Innovate, and the Bank of England’s FinTech accelerator, as examples of this. The welcoming regulatory environment has led to the UK becoming the third largest country for total capital invested in digital tech companies from September 2016 to August 2017 (only behind the USA and China).
Debt has remained a constant in the lives of a massive number of individuals in the UK. Currently, the debt of an average UK household has reached a record £15,400, amounting to a combined total of £482bn across the UK. Thousands of British people battle with debt each year, and it costs UK employers as much as £51 billion per annum. This has opened up an opportunity for the UK’s leading FinTech debt collection software companies to thrive. As MP Liam Fox outlined in The Department for Trade and Industry ‘State of the Nation’ report, “The UK is the leading global FinTech hub with a thriving ecosystem and international talent pool spanning the whole country. With an increasing number of FinTech firms exporting globally from the UK, we are continuing to set the global standard on the application of technology, and more broadly, innovation in financial services.”
The future is bright for the UK FinTech industry. It’s no surprise that the sector is enjoying record growth; it’s home to world-class talent, innovative technological approaches, and a great historical pedigree.
Learn how leading British technology firm, LATERAL, can revolutionise your debt collection processes.