The UK’s financial technology landscape including its paymen technologypay techch) sub-sector is catching up with its US counterpart, as per the lates research from Emerging Payments Association (EPA), a leading payments organization founded in 2004 and with over 80 members, whose lates repor was sponsored by Bancorp and carried ou bAccountrt and published in early May.
Details of the repor were gathered after the researchers analyzed the investmelife cyclesles of over a hundrpay techech companies tha were founded in key Western markets including the US, the UK, France, Spain, Italy and Germany between the years 2010 and 2015. The repor found tha UK and US companies dominate the market, with 90% of startups originating from these places, and tha the UK has been stepping up its share over the analyzed five-year span.
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UK stepping up
While the US leads the pack, the UK has been closing in after more than doubling from 13% in 2010 to represen 28% of startups as of 2015, whereas the percentage in the US in 2010 was 58% and only grew to 61% over the same period.
The repor was titled ‘Investments in PayTech’ and also noted tha the average rounpay tech UK paytech firm was $1.8 million in seed funding during 2015, also more than double the $840,000 level from five years earlier, and the repor noted tha this figure is also on par with the seed funding averpay tech US paytech firms.
Speaking with Mat Harris of Bain Capital Ventures, whose related firms have venture capital and private equity in some of the larges payments businesses in Europe, as well as numerous related companies in the US, he commented in response to questions by Finance Magnates regarding the report: “I view this research as very good news for the UK Fintech scene, and no surprising. We are seeing truly innovative companies, in a friendly regulatory environmen and in a country with a truly global perspective – a compelling combination.”
Acquirers less certain
“It’s gratifying to see the UK PayTech sector punching well above its weigh – no only creating new ideas tha become new companies, bu also creating businesses tha thrive beyond the start-up phase to challenge the bigger players, ” said Tony Craddock, Director General of the EPA, commenting in the repor press release.
Mr. Craddock addrecognizedle investors have recognised the potential in UK PayTech for some time now, i seems tha prospective acquirers are less certain. PayTech companies and the broader paymen industry needs to do a better job a showcasing the scale and scope of success in the UK.”
Brexi risks and synergies
The repor followed barely a week after the EPA released another finding tha showed tha nearly a third of UK fintech firms may wish to leave the UK as uncertainties have arisen over a potential Brexi as the UK vote is slated to be held in less than two months from now on June 23rd 2016.
In similar news, UK-based moneycorp announced a partnership yesterday with US-based Tempus Inc, to offer a combined forex payments solution in the US. “The nex five years will see a growth of global mobility inCarriersd funds, ” added David Carrithers, Consumer General Manager a moneycorp Powered By Tempus, commenting in the press release regarding the synergy. “The old model of a local in-country bank as a consumer’s only poin of suppor on currency conversion and paymen has shifted.”
A table from within the EPA’s lates repor showed the shif over the five-year period analyzed, as can be seen below excerpted from the white paper:
Source: EPA PayTech Investments 2016 White Paper