Could Silk Road partnership be key to UK taking fintech crown?
Britain’s investment in the financial technology industry has hit a new record, with almost £18bn worth of deals in the first half of this year, placing the UK second in the world behind the US. This comes as India’s rapid economic recovery leads to a tripling of its Foreign Direct Investment (FDI) output. As over half of all Indian FDI heads to Britain, this investment relationship could be more good news for British fintech, and the UK in general, with the potential to topple America’s sectoral dominance.
London’s Square Mile continued to dominate Europe’s fintech sector. According to the Pulse of FinTech report by KPMG, the UK secured investments of $24.5bn (£17.7bn), second only to the US, which hit $42.1bn and more than four times the $5.9bn of investment seen in the UK during 2020.
According to the Reserve Bank of India, Indian businesses made outbound FDI of $12bn in the first quarter of 2021-2022 – a threefold increase over the previous year. This makes India Britain’s second biggest source of investment, and as it is growing at an incredible pace, this good news is only set to provide a growing boost to the UK. Furthermore, this symbiotic relationship can only become more fruitful as both nations work towards a free trade agreement.
Nayan Gala, founder of JPIN VCATS, comments: “Both India and Britain, and their tech sectors, are growing at an incredible pace, and these figures show that this symbiotic relationship is only becoming more beneficial. This makes India’s rapid economic recovery very much in the UK’s interest, and likewise, it is clear Britain’s incredible financial and technology sectors are the favoured by Indian businesses and investors.
“I can only see this relationship becoming more important as the UK, like the rest of the world, begins to focus on the Indo-Pacific region, with India at its heart, and as both countries work towards a free trade agreement. India’s inevitable rapid growth could therefore have the potential to propel British fintech to the top of the podium – taking the crown from America and Silicon Valley.”
