A Record-Breaking Year for FinTech

By Veronica M Glab, Head of Engagement, Innovate Finance

Since 2014, Innovate Finance has served as the voice of UK FinTech, convening the community and tracking key trends in  investment, partnerships and regulation to bring our members the insights they need to make informed decisions. Our quarterly and annual reports on the FinTech investment landscape have covered the state of UK, European and global investment through the maturation of the sector and the rapid evolution of trade and regulatory landscapes. This year, after a period of unprecedented global challenges, we are excited to report record-breaking results for both international and UK FinTech:

  • Total capital investment into FinTech broke $102 billion across the globe in 2021, a 183% increase from 2020.
  • The UK FinTech sector leapt forward with 217% year-on-year investment growth (237% increase outside of London and the South East) reaching $11.6 billion.
  • The UK cemented its place once again as the second top global destination for FinTech investment, (behind only the United States) and as the leading European hub.

There were over 30 mega deals in the UK alone this year, the majority of them topping $200 million, and over 700 deals in the UK in total. More than 6,000 deals took place globally from seed stage through late-stage venture capital. 

UK FinTech saw a total $11.6 billion invested, including VC investments and IPOs such as money transfer app Wise and pensions provider PensionBee. 

Below, we cover the impressive achievements of the past year globally and closer to home, with an optimistic outlook for the year ahead.


2021 was a first-class year for UK investment. We hosted the Global Investment Summit, which secured nearly £10 billion investment into our industries of the future. And we proved that the UK fintech sector is more than a force to be reckoned with, maintaining our position as the number one fintech investment destination in Europe, and number two in the world, second only to the US. Thanks to our welcoming business environment and our world-class fintech ecosystem, we more than doubled 2020’s fintech inward investment figures, with more than 10% of deals worldwide landing on UK soil. A fantastic achievement with even more to come!”

- Lord Gerry Grimstone, Minister for Investment

Sustained Global Growth

The size and continuity of investment in payments, challenger banks, and blockchain have cemented FinTech’s place in the financial system.

The rising tide of 2021 amounts to $102 billion invested into the FinTech sector globally, a 183% rate of growth from an already impressive 2020 (when global investment reached approximately $36 billion in closed deals according to recent Pitchbook estimates).

Building on 2020’s results, early-stage VC grew 193% to $23.9 billion across 2273 deals. Late-stage investment grew 181% to $62.5 billion across 1356 deals. And Growth and Expansion deals grew 247% to $10.5 billion across 207 deals this year.

In Europe, the UK led the pack with over 713 deals and over $11.6 billion invested. Closely following were Germany ($4.4 billion), France ($2.3 billion), Sweden ($1.7 billion) and the Netherlands ($1.6 billion). Iceland ($616 million) was a surprising sixth, thanks two deals closed by UK-grown SaltPay (an April deal at $361 million and a November deal at $254 million) which now makes its home in Reykjavik.


2021 was again dominated by Covid as we started and ended the year with lockdowns and WFH orders. The result was further acceleration towards the digitisation of financial services. …Incumbents are being challenged like never before and while not every new firm will proposer long term, this effectively is a rising tide lifting all boats.”

Martyn James, Managing Director, ETFS Capital

The UK In Context

The UK remains a leading destination for innovators and investors, trailing only behind the US in global FinTech venture capital investment. In Europe, the UK ranks first, outpacing its closest contender, Germany, by about $7 billion in inward FinTech investment. Investment in the UK was equivalent to the next six countries in Europe’s Top 10 combined.

Breaking $11.6 billion in VC deals, the UK accounts for 11.4% of global investment. This level of capital investment is spread across over 713 deals, 31 of which topped $100 million.


COVID accelerated the digitalisation of financial services everywhere and UK FinTechs are well placed to serve the post-Covid world because their founders have the technology, talent and a natural drive to build global businesses.”

– Kevin Chong, Co-Head, Outward VC

Investment into UK and European FinTech:

Mega Deals As UK
FinTech Matures

Last year, Innovate Finance reported that “FinTech companies are continuing to grow and attract large investment rounds, as a sign of the sector’s maturity”. In 2020, the UK was home to 9 mega deals over $100 million each, with an average mega deal size of $220 million. This year we have seen 31 mega deals, 18 of them over $200 million. Some home-grown unicorns like Rapyd saw multiple rounds in excess of $200 million.

Following on last year's trend, where the majority of investors leading these mega-deals were international, 2021 repeats this pattern, with some notable exceptions, with top deals at the hands of:


“The industry is starting to mature but the wider opportunity remains nascent where incumbents still dominate in terms of market share”

- Tim Levene, Augmentum FinTech



Led by Alanda Capital Mgmt and SoftBank among others.


From investors including Abu Dhabi Growth Fund, Accel and Passion Capital.


From Blossom Capital and Tech Nation.


Led by Fidelity, Goldman Sachs and Qatar Investment Authority.


From Entree Capital and JamJar Investments, among others.

Rounding out the Top 10 Deals were Genesis Digital Assets ($312 million), Storfund ($300 million), followed by Ascot Lloyd ($300 million), DivideBuy ($300 million) and Many Group ($249 million). These Top Deals represent a diverse set of FinTech verticals: digital banking, payments, Buy Now Pay Later and cryptocurrency trading.

Top Players Of 2020: UK IPOs

This year saw increasing diversity in the FinTech Verticals in UK IPOs, with high-growth pensions provider Pension Bee’s public offering making multiple headlines.

  • PensionBee debuted on the London Stock Exchange in April with an initial valuation of £365 million (or $497 million, adjusted). In addition to its strong valuation and strategic choice to debut in London, PensionBee is one of the UK’s most notable female-driven FinTechs, with CEO Romi Savova at the helm.
  • Wise (the simply rebranded TransferWise) chose London as the natural launchpad for its debut. The hotly anticipated initial public offering brought Wise an $11 billion valuation and secured a victory for the UK as a cradle for tech investment.


UK regions saw rapid growth with $696 million investment outside London and the South East in 2021  compared to $206 million in 2020 - a 237% increase and a testament to the growing strength of the FinTech community across the entirety of the UK.


Analysis of investment into female-led FinTech companies  shows that we as an industry still have a long way to go on fostering greater diversity across the sector. 

In 2021, FinTechs co-founded by women or led by female CEOs represented 58 deals and $1.1 billion in capital invested into those companies. These companies represented c.8% of the total number of deals in the UK, a 2 percentage point decrease from 2020. In terms of capital invested, the $1.1 billion in inward investment is c.9% of the UK total, on par with figures from last year.

However, the 2021 investment in FinTechs co-founded by women is 1.5 times the amount in 2017, when the proportion of total capital invested in FinTechs co-founded by women was only 4%. of the total.

Female-led FinTech made several major headlines this year as PensionBee announced its initial public offering in April, under the deft leadership of its Founder/CEO Romi Savova. 

Founded and led by Anne Boden, Starling Bank boasted an impressive £322 million Series D investment round, the fourth largest deal to occur in UK FinTech this year. Starling is now firmly part of the UK’s unicorn stable.

A third notable example comes from remittance provider Zepz, formerly WorldRemit. Initially co-founded by the late Catherine Wines, Zepz raised an impressive £211 million in its Series E Round this year.

These success stories alone account for nearly £600 million of the £1.06 billion invested into female-led FinTechs this year. This ratio points to the incredible success available to companies with a woman at the helm and to a priority where progress must be made. 

There are approximately 110 female-driven FinTech companies in the UK and the majority have received comparatively little or no investment this year.  Further analysis suggests that a portion of these companies have not yet reached maturity to seek for investment at the VC stage. 

Interestingly,a recent report highlighted that female-founded FinTechs were more resilient to the pandemic, citing that 78% of female-founded FinTechs had more than 18 months cash reserves while approximately only 50% of male-founded FinTechs had less than 18 months cash reserves. 

With the tremendous rate of growth across the UK FinTech sector, there remains ample opportunity for FinTechs to hire and promote women to C-suite leadership and for investors to back more female and underrepresented founders.

A Look Ahead Into 2022 Trends

In 2021, the UK FinTech sector brought in more than triple the amount of capital investment than it did in 2020 or 2019. This unprecedented level of inward investment has confirmed the UK as the top FinTech centre in Europe. It has also prompted many questions about the outlook for 2022.

Tom Bull, UK Head of FinTech at EY, commented: “UK FinTech has had a remarkable year with many firms shifting to the scale-up phase and growth in partnerships in the market. The UK continues to out-perform the impressive international level of growth, demonstrating the power of UK FinTech on the global stage. 

“UK FinTechs are increasingly considering IPO as a short or medium-term option to achieve growth, which is not only attractive for established FinTech firms but also provides confidence to investors in earlier stage firms as it demonstrates that there is a natural exit route into public markets for younger firms reaching maturity.”

Investors and policy-makers can expect to see greater activity in several specific verticals and areas of activity that may offer attractive investment opportunities or require government support and regulatory action:

Digital transformation: Digital transformation has occupied the agendas of both FinTechs and legacy institutions since before the pandemic. In 2022, adds EY’s Tom Bull, “a number of financial institutions [will] undertake bold M&A transactions in the FinTech market, particularly as they look to access greater digital capability. We expect this trend to continue as major firms continue to focus on their digital transformation agendas.”

Cryptocurrency/Digital Assets: Digital assets trading accounted for four of the UK’s 30 mega deals this year, representing $1.09 billion  earned investment. In Europe, cryptocurrency trading put Gibraltar at Number 9 of Europe’s Top 10 largest FinTech players. Gibraltar’s $495 million in investment across 6 deals were all trading platforms for digital assets. “The value creation in such businesses due to growing institutional and mainstream adoption will dwarf anything seen in crypto to date,” says Martyn James, Managing Director at ETFS Capital. “ But we expect there will be a quid pro quo. Institutional and mainstream investors are likely to be much more demanding, so the crypto winners going forward will be those firms that can combine the innovation of crypto with the professionalism of established asset management.

Payments: Payments accounted for eight of  the UK’s 30 mega deals, representing over $1.7 billion in inward investment. Within this vertical are companies offering API, mobile payments and B2B as well as B2C payment solutions, clearly illustrating  the UK’s continued  digital payments journey. 

Buy Now Pay Later (BNPL): Storfund and DivideBuy made waves in the UK in 2021, with deals accounting for $300 million each this year. Abroad, Klarna brought in one of the world’s largest deals of the year at $930 million in March followed by a second investment round in June that brought the BNPL leader another $450 million in earned investment.

Concluding Remarks

2021 was a landmark year for the FinTech industry, as the burgeoning sector has turned numerous challenges into opportunities for innovation. In the UK in particular, we saw continued government support of the sector, the launch of Ron Kalifa’s independent review into UK FinTech, landmark changes to our regulatory framework, and FinTechs stepping up in critical ways to support consumers, SMEs, and the broader economy as we emerged from the crisis.  With record-breaking numbers for VC deals worldwide, the investment landscape suggests that the FinTech sector will continue to grow, to inspire regulatory changes, to benefit the end consumer, and to change the way we interact with the financial system. The impressive growth points to certain areas or regions where opportunities lie ahead, as well as to areas where progress can be made.

Across the $102 billion invested into global FinTech, the dominance of challenger banks, payments providers, crypto traders and lenders point to global appetite for convenient ways to engage with the financial system and better opportunities to access capital or financing. We are also hearing of a growing appetite amongst investors to look at FinTechs that are supporting us all in reaching our ESG and net zero goals, to support a more sustainable future.

In turn, the significant increase in the number and size of mega deals ($100 million+) in the UK and US in particular reflect the appetite of investors to back the innovators providing real world solutions.

Where might the next great opportunities lie in 2022? For one thing, the digital lenders, payments providers and digital assets traders that triumphed last year will certainly attract further investment across all global regions as they offer real-time solutions to consumer demand for better banking and access to capital. 


The challenge for investors is building a strong portfolio of early stage FinTechs that they can follow-on into as the later-stage rounds are increasingly over-subscribed and often inaccessible,”

- Kevin Chong, Co-Head, Outward

On the other hand, if Kevin Chong’s advice to pursue early stage FinTechs rings true, investors may be wise to consider funding female-led companies. Boasting over $1.1 billion in funds raised in the UK alone, female-founded and led FinTechs like Starling Bank and PensionBee have shown the high level of growth available.  This is a huge opportunity: the vast majority of women-led  FinTechs in the UK are still on the lookout for funding.

Across the UK, the outlook for 2022 remains positive. With London continuing to lead the way across all investment stages, there remain ample opportunities for investors and public sector stakeholders to allocate resources to vibrant  FinTech hubs outside the capital. An increased growth rate across the regions and nations of the UK is leading to considerable opportunities and sustainable levels of investment in hubs across all four countries of the UK.

Regardless of one’s sectoral or regional interests, one thing is certain: for the FinTech sector, 2022 begins on a very hopeful note.

Basis of preparation

The data was compiled and summarised by Innovate Finance on 2nd January 2022 and [20]th January 2022 using PitchBook data. FinTech investment includes accelerator, incubator, angel, seed, early and later stages VC, and PE growth/expansion funding. The data has not been reviewed or approved by PitchBook.

Innovate Finance is opening up access to capital for our FinTech members, providing connections to the venture community and delivering insight with our UK Investment reports. The programme runs throughout the year and provides ongoing insights and events such as speed-dating between startups and investors. Click here for more information.