London Fintech Week 2019 | London’s rise to fintech fame

London Fintech Week is back for its sixth year, with a variety of events taking place in Shoreditch from 4-9 July.

Over 2,000 participants from 50 countries are expected to be involved throughout the week across a tight schedule of conferences, hackathons, meet-ups and networking events.

Some of the key themes up for discussion will be regulation, the rise of challenger banks, decentralisation, insurance, and technological advancements such as AI.

London Fintech Week has referred to London as “the heart of the Fintech revolution”, so here we take a look at London’s rise to the top of the global fintech pecking order, and how it has achieved such a reputation.

History and heritage

London is home to some of the most infamous and historically significant financial institutions and banks, giving it not just great pedigree and respect across the globe, but a strong foundation on which to innovate and support the shift to an increasingly digital economy.

  • The Bank of England

London’s fintech scene has the support of the Bank of England, which has said it is committed to embracing fintech to deliver its mission. It is upgrading its hard infrastructure, such as payments architecture, to enhance security and support innovation, while also updating its rules/regulations to mitigate potential risks.

  • London Stock Exchange

The LSE Group provides leading investment insight into the opportunities within the UK’s fintech scene. It releases an annual ‘Fintech Comes of Age’ report, the most recent of which describes London as a global hub for fintech and explains that it’s the ideal destination for fast-growing companies to boost visibility and where long-term institutional investors are seeing growth opportunities in the fintech sector.

In May it hosted its fourth annual Fintech Investor Forum, focused on the UK’s strength as a global fintech hub and the investment landscape.

  • Banking pedigree

London is home to financial services multinational Lloyd’s of London, HSBC’s headquarters controlling 7,500 offices in 87 countries, Barclays and Standard Chartered. There are over 500 banks in the capital, including 251 international banks.

Talent & jobs

Software developers are crucial for continued innovation and product development. As of 2018, London had 357,900 of them – more than any other European city, and up 17 per cent on 2017’s figure (source: London & Partners).

Fintech jobs in the UK in 2018 increased 61 per cent on 2017 (source: UK Fintech salary report, Robert Walters), which London played a key role in, and career opportunities are only continuing to rise, such is the attraction of working for a well-backed, fast-growth company in London with the added bonus of a start-up culture.

Supportive regulation

In its latest ‘Fintech Comes of Age’ report, the London Stock Exchange revealed that investors value the strong governance standards and robust legal and regulatory environment which are allowing Fintech innovation to thrive in London. Strong and robust, but certainly not restrictive. Since 2008’s financial crisis London has made a conscious effort ting be open and supportive, shown a really progressive attitude to regulation which is evident in the rate at which new fintechs are popping up to disrupt their respective sectors all the time.

Compare it  to another fintech hub, such as Canada, where fintech innovation is being stifled by what’s been described by Michael King, Finance Professor at Ivey Business School, as a “complex, costly and chaotic regulatory system”, and it’s clear London is the place to be for regulatory support.

Unicorn start-ups

London has become Europe’s capital of billion-dollar technology start-ups, not least in fintech:

  • Monzo: 200,000+ people joined the waiting list when it launched. Reached unicorn status in 2018 following £85 million funding round. Has surpassed 2m customers, and this week announced £113m from US tech investor Y Combinator – around that values Monzo at more than £2 billion.
  • Revolut: Raised £179 million Series C in 2018, now worth £1.2 billion. Looking to raise £400m this year.
  • Worth £1.57 billion following largest fintech series A round in Europe (the third largest globally).
  • Greensill: SoftBank invested £630 million earlier this year, taking Greensill’s valuation to £2.7 billion.
  • Transferwise: Founded in London by Estonian developers Kristo Käärmann and Taavet Hinrikus – now worth £3 billion.

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