Fintechs optimistic about expansion despite Brexit and Covid-19 fears

Over two-thirds of fintechs plan to expand internationally in the next 18 months, according to a survey of 50 fintech executives by Newfound.

Although the economic fallout from Brexit and the Covid-19 pandemic is making fintechs more cautious, 68% of fintech executives expect to expand into new markets in the next 18 months, with nearly one third “ready to expand now and actively seeking growth opportunities”. Just 2% said they wouldn’t expand anytime soon.

With the Brexit transition period coming to an end on the 31 December 2020, fintech executives were apprehensive about Brexit uncertainty. Despite this, access to talent is the primary reason for those looking to expand to the UK specifically. As such, programmes that aim to attract new tech workers to the UK – such as the Tech Nation visa programme – are critically important.

“The fintech industry was forged in the 2008 financial crisis, and it is no surprise that the sector is resilient and optimistic in the wake of macroeconomic events like Brexit and Covid-19,” said Peter Gillingwater, CEO of Newfound.

“It is promising to see so many firms are looking to expand over the next 18 months. The sector is emerging strong after a turbulent year, which bodes well for the European fintech market. However, growth may be slower than pre-pandemic levels and fintechs are asking for more support from the government and industry to give them the best chance of success.”