The Mayor of London is leading a fintech trade mission to Japan to forge a cross-border collaboration pact in the run up to the 2020 Olympic Games as new research reveals growing uptake of innovative financial services models by wealthy young professionals.
The capital’s booming financial technology sector is being driven by record levels of investment and the rapid adoption of emergent fintech products, according to a study conducted by London & Partners, The Mayor of London’s promotional company, and EY.
Venture capital investment in London fintech has rocketed from £24m in the whole of 2010 to £312m in the first six months of this year alone. While investment is increasing, the EY data shows that wealthy young Brits are warming to new models for saving and spending in P2P, mobile and investment. In the last six months, 35% of the United Kingdom’s online population has used at least one emergent fintech product, says EY, and people’s usage increases in line with their income.
Imran Gulamhuseinwala, EY’s head of fintech in EMEIA, comments: “At approximately £20bn of revenues, the UK has a world leading fintech footprint. Crucially we estimate that as much as 20 per cent is generated from the high growth "emergent" fintech segment including online payments, online security and marketplace lending. We think there’s potential for the UK fintech industry to generate an additional £16bn of revenues by 2020.”
The figures have been seized on by the Mayoral delegation in Japan as further evidence of London's status as a fintech powerhouse in Europe.
Eileen Burbidge, partner at Passion Capital and technology ambassador for London, says: “London is rapidly becoming one of the most exciting cities in the world for fintech. Collaboration between London and Tokyo, two tech powerhouses, will accelerate engagement with financial technology ahead of the 2020 Olympics, spurring an opportunity for growth in other sectors.”
During an event attended by the Mayor, at the British Ambassador’s residence in Tokyo, WorldRemit announced plans to make its mobile payment services available to the Japanese market later this year.
Gordon Innes, CEO at London & Partners says: “London leads the way in the development of financial technologies such as mobile payments and digital currencies and is home to some of the world’s fastest growing fintech businesses such as TransferWise and WorldRemit. With a number of leading Japanese banks and technology companies already with a presence in London, Tokyo is a natural partner for London to share our fintech success and to collaborate on growing the sector in both countries ahead of events such as the 2020 Olympics.”