EY’s figures show that with revenues of approximately £20bn of revenues, the UK is a world leader in fintech with 20% of that revenue being created online payments, online security and marketplace lending. They have also heavily suggested this is not a flash in the pan and there is a very real opportunity for the UK fintech industry to generate an additional £16bn of revenues by 2020.
In the last 5 years between venture capital investment in London fintech has increased from £24m in 2014 to £312m in the first six months of this year alone and this unparalleled level of growth has been mirrored by the rate at which London has attracted brand new international tech investment projects. EY’s report suggests more than 1000 individual projects have been drawn to London during the last 10 years which is not only more than any city, but more than any other country in Europe.
While investment is increasing EY’s imminent report clearly shows that wealthy young Brits are adopting new fintech products at a rapid rate. Over the last six months more than a third of the UK’s online users have used at least one fintech product. People’s level of usage seems to increase in line with their income with the highest users being those aged between 25 and 44 who earn more than £50,000.
EY’s projections state the level of growth will continue and over the next 12 months an additional 8% of the UK’s online population will start to use fintech products with online payments and investment products being the key services. If this level of usage is realises, it will make the UK one of the most advanced and attractive fintech markets in Europe.
Meanwhile further analysis by credit card giants MasterCard shows the UK is a world leader in cashless transactions. The UK’s position is being cemented by technologies such as contactless card payments on the London Underground. Contactless (a payment for purchases of £30 or less by card, fob, wearable or mobile device) has become a favoured method of payment by British consumers and has use has rocketed by 560% in the last 12 months alone.
During his 3-day trade mission to Japan to foster closer alliances between London and Japanese business, London’s Mayor Boris Johnson said:
“Londoners are embracing financial technology as the use of contactless on the London Underground and mobile payments used throughout the city shows. As our expertise flourishes in this area, I am delighted companies based in London are taking their goods to Japan and we are now sharing that knowledge and experience with our Japanese counterparts to further fuel this innovation and growth.”