The UK fintech industry could have potentially lost investments up to £1.4 billion because of the protracted pandemic, according to a study conducted by Qadre and techUK. The study showed that nearly 68 percent of 59 fintech founders as respondents have lost a significant funding opportunity because of the current crisis.
It is reported that the UK comprises more than 1,600 fintech companies. It is recognised as one of the most accomplished fintech startups in the world with $4.9 billion of capital raised in 2019. This has exceeded $3.6 billion raised in 2018.
Nick Williamson, CEO of Qadre, said in a statement, “The UK has one of the world’s most successful fintech markets, but company founders are facing unprecedented economic headwinds with Covid-19 at the eye of the storm. At this time of uncertainty, equity management processes are preventing fintechs from raising money, delivering new services, and growing their business. Equity management isn’t just inconvenient, it is damaging UK fintech. It has never been more important for fintechs to streamline unnecessary tasks and focus on developing products and services that can help them ride out this storm.”
Besides the pandemic, the study pointed to equity management as another reason upsetting the UK’s fintech boom. It appears that more than 67 percent of fintech founders in the country see equity management as a distraction slowing down innovation and affecting operational resources. In addition, the Covid-19 pandemic has worsened their situations in many ways.
Recently, the UK government launched a €1.4 billion initiative to support the country’s most innovative SMEs and startups at this time.