FinTech startups are increasingly focused on building smarter machines as they seek to gain a better understanding of artificial intelligence (AI) to solve customer issues, a new report from the Startupbootcamp FinTech London programme and PwC has revealed.

More than 15 per cent of applicants to the 2016 incubator programme looked to build new AI and machine learning prototypes, as the use of chatbots and virtual assistants to deal with customer queries becomes more widespread.

However, the report notes that investors do not harbour the same excitement for AI and machine learning as the startups, with investments being driven by financial companies themselves. Despite the 16 per cent of applications to Startupbootcamp being focused on smarter machine, just nine per cent of investment focused on this area.

The percentage of UK-based startups who applied to the accelerator programme rose from 22 per cent last year to over a third (34 per cent) this year.

Francisco Lorca, managing director of Startupbootcamp FinTech London, said: “Despite political, economic and financial uncertainty causing people to believe FinTech might be derailed, at Startupbootcamp we have yet to see any real impact.

“This year, we have seen the sector’s entrepreneurs, including the Startupbootcamp FinTech 2016 cohort, consistently proving that they have genuinely transformative ideas to offer – and that these ideas are commercially viable. One can only imagine what will come next, but both incumbents and start-ups should be prepared to embrace the change.”

Steve Davies, EMEA FinTech leader at PwC, added: “The FinTech industry is not immune to broader political and economic uncertainty but the UK remains very well placed to lead the way. As the UK’s position in Europe post Brexit becomes clearer, startups from across the world will continue to travel here to work with international investors, partner with leading financial firms and develop under a forward thinking regulator.”

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