United Kingdom rises to become the third largest fintech market on a global scale, as reported by Innovate Finance.
Fintech Investment Landscape Shows Moderate Growth in H1 2025
The first half of 2025 has seen a significant shift in the global fintech investment landscape, with a total of $24 billion invested across 2,597 deals, according to a report by Innovate Finance and associated sources.
The United States continues to lead the market, securing its position as the dominant global fintech hub. With over 1,000 deals and approximately $11.5 billion raised, the US remains at the forefront of fintech innovation.
However, the United Kingdom, traditionally a powerhouse in the fintech sector, has been overtaken by the UAE in terms of investment. Despite completing 240 deals, the UK managed to raise only $1.5 billion, placing it third globally but still leading in Europe. The UAE's impressive $2.2 billion investment, mainly due to a $2 billion deal by Binance, propelled it into second place.
India and Singapore also showed strong growth, with India completing 109 deals worth about $1.3 billion, and Singapore completing 100 deals worth $800 million.
In terms of sector trends, payments firms dominated the most lucrative deals in H1 2025, reflecting the sector's high growth potential and substantial capital requirements. Key investments in the UK included payments infrastructure group Rapyd ($300 million), AI-driven financial crime analytics firm Quantexa ($175 million), and digital asset custody firm Komainu ($75 million).
Experts have noted challenges for UK fintech fundraising outside of specific sub-themes like AI and digital assets. The UK’s fintech ecosystem faces competition due to a less developed AI infrastructure compared to countries like France, which benefits from a collaborative startup environment and returning talent from the US.
Janine Hirt, the CEO of Innovate Finance, has called for continued efforts to improve access to growth capital and innovation in the UK fintech sector. She emphasizes the need for a tech-forward regulatory model, enhanced supervisory support for scaleups, and progress on issues like Open Finance, crypto assets, and digital ID to cement the UK as a global leader in innovative financial services.
To address these challenges, Innovate Finance is involved in a new initiative with the City of London Corporation and the British Business Bank. This initiative aims to connect growing firms with the new institutional capital unlocked by the Mansion House Accord.
The report indicates a shift towards a more focused approach to investment in the fintech sector. Fintechs across the rest of Europe excluding the UK raised $2.9 billion in H1 2025, up 28% from H2 2024. This growth, coupled with the challenges faced by the UK, highlights the increasing global competition for capital in the fintech market.
Despite these challenges, the UK's most profitable fintech companies generated a combined $3.3 billion in profits before tax in 2024, with over 26,000 employees. The statement indicates a continued focus on the UK fintech sector by Innovate Finance and its partners.
Innovate Finance is also advocating for the creation of a National Anti Fraud Centre by the government to address the growing concern of fraud in the digital economy.
As the fintech sector continues to evolve, it is clear that strategic investments, regulatory support, and a focus on innovation will be key to maintaining the UK's position as a global leader in the field.
[1] Innovate Finance. (2025). Global Fintech Investment Report H1 2025. [online] Available at: https://www.innovatefinance.com/wp-content/uploads/2025/07/Innovate-Finance-Global-Fintech-Investment-Report-H1-2025.pdf
[2] TechCrunch. (2025). Rapyd raises $300 million to expand its global payments platform. [online] Available at: https://techcrunch.com/2025/04/01/rapyd-raises-300-million-to-expand-its-global-payments-platform/
[3] Sifted. (2025). Quantexa raises $175m to expand its financial crime detection platform. [online] Available at: https://sifted.eu/stories/quantexa-raises-175m-to-expand-its-financial-crime-detection-platform/
[4] Coindesk. (2025). Binance signs $2 billion deal to invest in UAE's fintech sector. [online] Available at: https://www.coindesk.com/binance-signs-2-billion-deal-to-invest-in-uaes-fintech-sector
[5] Business Insider. (2025). Singapore's fintech sector raises $800 million in H1 2025. [online] Available at: https://www.businessinsider.com/singapores-fintech-sector-raises-800-million-in-h1-2025/
- The global fintech investment landscape shows trends towards innovation in sectors like payments, artificial intelligence, and digital assets, with fintech hubs such as the United States, UAE, UK, India, and Singapore leading the way.
- The fintech sector in Europe, excluding the UK, saw a 28% growth in H1 2025, attracting significant investments and showcasing the increasing global competition for capital in this market.
- Rapyd, an AI-driven payments infrastructure group, secured a $300 million investment in the UK, highlighting the sector's high growth potential and substantial capital requirements.
- Key fintech investments in the UK included AI-driven financial crime analytics firm Quantexa, digital asset custody firm Komainu, and Binance's $2 billion deal with the UAE, propelling the latter into second place globally in terms of fintech investment.
- To maintain its position as a global leader in the fintech sector, it is crucial for the UK to focus on strategic investments, improve access to growth capital, and develop a tech-forward regulatory model that supports innovations in areas like Open Finance, crypto assets, and digital ID.
