November 28, 2014 - London has cemented its position as a world leader in financial technology, with companies in the capital attracting more than US$539 million in venture capital investment so far this year – triple the amount raised in 2013 and more than half of all fintech investment across Europe.
The data - compiled by the Mayor of London's promotional company London & Partners - was unveiled by Boris Johnson while attending an event in Singapore to showcase the capital's fintech sector.
Further research by YouGov commissioned by London & Partners shows that more than half (56%) of senior executives surveyed in Britain's financial services sector believe London is best placed globally to lead fintech innovation, ahead of New York (three per cent), Hong Kong (four per cent) and San Francisco (eigth per cent), with London's position as a global trading hub cited as the key reason.
The figures are at odds with recent research from Kinetic Partners, which indicate that New York is outstripping London as the world's leading financial centre. Its annual survey, which draws on interviews around 300 respondents across the financial services and regulatory world, reveals that 59% see New York as top of the tree, compared to 38% who believe it to be London, down from last year's 44%. Only 28% believe that the latter will take the number one spot in five years' time.
But there is no doubting the boom in fintech investment currently being enjoyed by startups operating out of London. The UK fintech market is currently worth £20 billion in annual revenue and growing according to Ernst & Young, and London is now cited the world's largest centre for financial technology, with 44,000 people working in the sector - more than both Silicon Valley and New York - according to research by South Mountain Economics
London & Partners' YouGov poll of 217 financiers found that 81% of those surveyed thought that fintech was already having a transformational impact on the traditional financial services sector. More than half (52%) said high street, retail banks need to embrace new technology while 48% believe that banks are failing to adapt quickly enough to the challenges presented by advances in financial technology.
The Mayor of London, Boris Johnson, says: "London has always been at the forefront of financial innovation and now our financiers are leading another global revolution, this time driven by technological innovations that are changing the way the world does business, creating new jobs and economic growth both in the UK, and in the other financial centres of the world."
Johnson was speaking at an event co-hosted with the Infocomm Development Authority of Singapore. In October, the agency announced plans to tap into London's booming fintech scene with the opening of a new office in the capital and an undisclosed investment in accelerator Startupbootcamp FinTech.
Infocomm, which is backed by the Singapore government, is opening up its $200 million fund to European companies for the first time. The London office is only the firm's second overseas outpost, after Silicon Valley.
Steve Leonard, executive deputy chairman of Infocomm, says: "Singapore and London are natural partners. Just as we see London as a gateway into Europe, we want London to see Singapore as the best gateway to Asia."
At the event, Leonard announced that Startupbootcamp will launch an Asia accelerator programme in Singapore next year. To showcase Singapore's commitment to tech entrepreneurship, Leonard also announced that IDA would be partnering with London-based Founders Forum to bring its exclusive "Leaders-in-Tech" gathering to Singapore next April.
