Investment in the UK’s FinTech sector has more than doubled to £4 billion since 2018, according to new research.

According to Tech Nation’s annual report for 2019, the FinTech sector has also seen an employment boom, and is second only behind the US for global investment in the industry.

FinTech remains the UK’s largest tech sub-sector for investment, with the report stating there was “still huge potential for continued growth”.

A total of 44 per cent of Europe's FinTech unicorns - companies valued at over a billion dollars - and 46 per cent of Europe’s FinTech 'future unicorns' - those valued at $250 to $800 million - are based in the UK.

However, the European and wider FinTech scene is gaining strength. Germany saw a 61 per cent increase in investment to £1.1 billion last year and Sweden, a 417 per cent increase to over £750 million - albeit these are growing from a much lower base, the report highlighted.

“The UK's historic strength in financial services, combined with world-leading policy and regulation in the space such Open Banking and the FCA Fintech sandbox have contributed to building a world-renowned FinTech powerhouse in the UK,” the report stated.

The UK was also a global top performer for venture capital investment into artificial intelligence and deep tech companies. The sector raised £2.42 billion in 2019, growing 19 per cent in the UK.

This acceleration was mirrored by the growth in the digital technology sector, which grew nearly six times faster than the rest of the UK economy, with a record £10.1 billion invested in 2019 - an increase of 44 per cent.

The UK is third in the world for overall tech investment, behind only the US and China, and raised more than France and Germany’s tech sectors combined combined.

According to the analysis, the digital technology sector contributed £149 billion to the UK economy, accounting for 7.7 per cent of the UK’s gross value added (GVA) and employs 2.9 million people in the UK, up 40 per cent from 2017.

A total of 95 UK tech firms were valued at between $250 and $800 million in the 2019, up 27 per cent on 2018, in addition to the 77 $1 billion ‘unicorn’ companies currently in the UK.

The report also found that London ranks above the next closest European city for tech investment, with over double that accrued by Berlin from 2014 to 2019. Cambridge, Bristol, Edinburgh and Oxford also make the top 20 European cities for tech investment.

UK prime minister Boris Johnson said: “In the space of a single year, we have shattered all records, with technology investment in the UK soaring by 44 per cent to over £10 billion - more than France and Germany combined.

“Britain is second in the world for FinTech, with investment rising by over 100 per cent in the last year alone, and we are number one in Europe for the emerging technologies that will transform the lives of every single human being."

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