Despite worries to the contrary, fintech investors are still flocking to post-Brexit U.K.
Over half a billion dollars were poured into British financial technology companies in the first half of 2017, over a third more than the same period last year, trade body Innovate Finance said on Wednesday, in the latest sign the fast-growing sector is so far weathering Brexit.
UK-based fintech startups pulled in $564 million of venture capital investment in the first six months of the year, more than half of which came from outside Britain.
The number still lags 2015’s blockbuster ($676 million) first half, but is 37% more than what was posted in 2016, helping Britain take third place in global fintech investments behind the United States and China.
The EU referendum raised serious questions about the future of British fintech. Some were worried that investment in the government-prioritized sector would dry up; while most worried that a lack of access to highly skilled workers would mean an end to the industry’s boom:
“Talent is the number one concern, and has been consistently since the referendum.”
Another big concern had been future passporting rights. However, Innovate Finance estimates that if Britain loses its rights to trade with EU countries, only 20% of Innovate’s 300 registered startups would be affected, so while it’s still a big chunk, it’s still far away from debilitating.
At any rate, while investment remains robust in the U.K., globally, things still look rather muted. Fintech investment for the first half of the year stands at roughly $6.5 billion – down 47% from the previous year. That said:
…Innovate Finance said that was largely because of three Chinese “megadeals” worth more than $1 billion each that had all gone through in early 2016.