Nery Alaev writes about fintech in Europe, including the UK and Germany.
Funding for financial technology (‘fintech’) companies across Europe is growing, with Germany and the UK gaining momentum respectively.
Last week, I wrote about the strength of Germany’s growing fintech sector – this week I’m going to deeper into the sector.
Power in the UK, Germany
According to Business Insider’s Fintech Briefing, the UK dominated the fintech funding environment in 2015. For instance, Funding Circle raised £97m for its ventures, this is alongside other UK fintech organisations that also received high amounts ranging from £36m to £90m.
As for Germany, a total of €751m was received in 2015. This put Germany only second to the UK in regards to funding.
An interesting take-away from the briefing is that institutional funding is strong in Europe, meaning that financial institutions in the Old Continent are beginning to come around to the sector and realise that it can’t be competed with on all fronts
Instead of this, they are choosing to invest in fintech firms in order to prepare for the future.
While the UK may be a hub for fintech growth at present, concerns about the island nation’s potential exit from the European Union in summer 2016 are causing concern for fintech company figures.
For example, a recent Bloomberg article quotes TransferWise co-founder Taavet Hinrikus stating that:
„A Brexit would make it harder to access top talent, making London a less attractive place for growing companies to base themselves“
This comment clearly outlines a concern from Taavet Hinrikus about a talent shortage resulting from the Brexit.
Clearly, the industry is growing in size and financial clout both in the UK and mainland Europe, however it will have to grapple with the outcome of Europe’s current political turbulence, whether positive or negative.
Nery Alaev is the current Director of ESN Investments GmbH, which engages in acquisition and development of commercial and residential property in Germany and Austria.
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