European fintech investment tumbled 26 per cent to $8.3bn last year, amid rising interest rates, geopolitical instability, and tighter funding environments, new figures show.

The figures, supplied by UK fintech trade body Innovate Finance, show that the UK maintained its position as Europe’s fintech leader, raising $3.6bn across 576 deals in 2024, however this was 37 per cent down on the previous year.

UK fintech funding was dwarfed by the US, the market leader, which raised $22bn in 2024.

This decline in the UK means it no longer carries more investment than the whole of the rest of Europe combined, as it has in previous years.

Key funding rounds in the UK last year include challenger bank Monzo’s $621m round and a $267m round by payments firm Zepz.

Around the rest of Europe, behind the UK, came France and Germany, with France bagging $1.1bn in funding across 127 deals, down from $1.3bn the year previous.

Germany brought in $924m from 149 deals, slightly down from $1bn in the previous year.

Switzerland and Netherlands secured their positions in the top five European rankings.

Switzerland attracted $0.5bn, a 44 per cent decrease from 2023, whereas Netherlands was a rare case of increased investment, with $0.4, up 30 per cent from 2023. 

Completing the top 10 in Europe were Sweden ($0.4 bn), Spain ($0.3 bn), Denmark ($0.2 bn), Luxembourg ($0.1 bn) and Lichtenstein ($0.1 bn).

Janine Hirt, CEO of Innovate Finance, said:

“The latest figures tell a compelling story of resilience and adaptability. The UK’s ability to attract $3.6 billion in fintech investment during a year of economic turbulence reflects the strength and dynamism of our ecosystem.

“However, this is no time for complacency. We know the upswing in investment is coming, and we need to ensure that when it does, the UK is at the front of the queue as a destination for VC funding.

“To remain a global leader, we need to double down on innovation, market reforms and progressive regulation, ensuring we are prepared to capitalise on the next phase of growth and stay ahead in an ever more competitive world.”