Venture capital investment in the UK fintech sector was hit by Brexit fears in 2016, sliding a huge 33% to $783 million. In contrast, global VC investment in the sector spiked 11% last year to $17.4 billion, according to the latest Innovate Finance metrics. The association characterised the shift as a dramatic slowing “which many in the [fintech] community attribute to the general uncertainty in the run-up to the Brexit referendum”.
The Dutch Ministry of Foreign Trade and Development Cooperation has allied with the Rutgers Foundation to launch a crowdfunding initiative to raise money for family planning services in developing countries. The move follows efforts by the Trump administration to stop state funding to organisations that provide access to information about abortions – the so-called Mexico City Policy – leaving an annual global $600 million funding gap.
Fintech firms need more regulatory oversight as they have may disrupt the banking sector and threaten financial stability, warns German Bundesbank president Jens Weidmann. He says authorities need greater insight into such outfits’ activities to get a better understanding of how they might pose a stability threat.
Crowdfunding investors are in need of better protection in the UK as rapid growth has left them vulnerable with both investment-based and loan-based crowdfunding ventures, according to the Financial Conduct Authority. The regulator says its focus is ensuring that investor protections are appropriate for the risks of the sector and that its recently completed crowdfunding review findings mean it will now look into developing new rules during 2017.
The world’s first bricks-and-mortar crowdfunding shop has opened for business in Paris. KissKissBankBank, an operator of three online platforms in the shape of KissKissBankBank, personal credit operation hellomerci and business lender Lendopolis, has launched La Maison du Crowdfunding in a hipsterish area of the city’s tenth arrondissement where it is showing off a welter of communications assets aimed at upping knowledge of the world of crowdfunding.
Thirty UK-based fintech start-ups have had their funding cancelled or delayed by investors since the Brexit vote in June, giving them serious cashflow headaches.
Fintechs are getting traction with younger, tech-savvy and affluent banking customers, with emerging markets leading adoption – in fact, over three-quarters of that demographic in China and India are using services provided by fintech outfits, with consumers in the UAE and Hong Kong not far behind. Plus, half of banking customers globally are now leaning on fintech services firm, according to World FinTech Report from Capgemini, LinkedIn and Efma.
Close to 60% of US consumers believe that traditional banks will cease to exist within their lifetime as they are failing to both meet customers needs and to innovate. A huge 75% of respondents to a Blumberg Capital survey say that fintech gives them more power over their finances, while two-thirds say fintech provides access to services previously available only to the wealthy and that such tech will help everyone be better off financially.