Britain has a strong track record in fintech. We look at what’s needed to support further growth – for startups developing fintech apps, to firms integrating new services.
The UK government’s budget announcement last month and the start of a new financial year on 6th April mean that money is on the minds of many. Worries about managing personal finances are understandably pretty widespread. Yet those with a stake in the fintech sector will also be using this period as an opportunity.
Whether they’re looking at developing a SaaS or fintech app, startups and individuals will be identifying opportunities to develop platforms that solve problems for consumers, while providing a boost to the fintech market.
In order for them to do so, a few things are needed: investment, buy-in from consumers, fintech and SaaS development expertise, and optimism to seize opportunities.
Money worries
Before we jump to the opportunities, let’s first address those worries. Last year, investment in UK fintech dropped to £9.75 billion, down 34% from £14.82 billion in 2022. This news was followed by the announcement of another sobering statistic in February: the UK GDP contracted 0.3% in the fourth quarter of 2023, defining a period of recession.
However, if we look at the broader picture there’s still room for much optimism. The decline in UK fintech investment merely reflects a global trend, and despite this decline last year’s figures for total global investment in fintech were still 10% higher than the last pre-covid year of 2019. British fintechs are leaders on this global scale. They are still attracting more funding than those in France, Germany, China, India, Brazil and Canada combined, making Britain the second largest destination for fintech investment, after the US.
A rich fintech market
In recent years there have been a huge number of fintech success stories coming out of the UK, such as Revolut, Monzo and Starling. Competition is healthy, but it can mean difficulties for smaller startups wanting to enter the space. Luckily, digital challenger banking apps such as these are only one part of the market. We’ve also seen the creation and growth of fintechs specialising in things like international money transfer (such as Wise and TransferGo), investment and wealth management (such as Nutmeg), loan provision (such as Lendable), and payment solutions for small businesses (such as SumUp).
In another sign of the size and scope of opportunity in the sector, it’s worth noting that there are also a large number of companies that have developed and integrated fintech app functions into their own platforms. This is something the team at Appdrawn have direct experience in. We worked with The Kindness of Strangers (TKOS) to launch a feature-rich SaaS platform to empower TKOS’ customer base of small and mid-sized charities.
Put your money where your mouth is: Appdrawn’s fintech experience
The solution includes all the tools needed for a charity to build awareness and to hit fundraising targets – including critical payment and financial analysis technologies. The fundraising calendar, for instance, allows the platform’s users to strategise budgets and fundraising.
The platform also allows users to create a funding plan tailored to the needs of their organisation, recommending different ‘pathways’ depending on those needs. Users can then access advice on how to follow pathways, with tools integrated into the platform to enable this. An integrated grants database simplifies the arduous process of searching and applying for grants. Finally, the platform is only one of a handful (most of which are only available to larger charities) to have direct integration with HMRC, enabling automated gift aid claims.
From increasing the financial impact of your charity to growing your personal piggy bank: the market for fintech apps is vast. As a consumer, anything you want to do with money you can probably do with an app. As a startup or an individual with an idea, anything you want to help consumers do with money, you can most likely create an app for! In addition to the above examples, there are dedicated apps for getting insurance, spreading the cost of online shopping, tracking your spending, aggregating payments, streamlining subscriptions, billing and automating admin tasks – and more.
Consumer buy-in
As well as funding a rich fintech ecosystem, there’s another factor that will support the development of fintech apps. Thanks in part to the acceleration of digital adoption during the pandemic, by 2021 86% of Brits were using fintech apps to manage or spend their money. Established levels of confidence among the public are spreading to the business world too, with the use of open banking platforms becoming more mainstream.
Finally, the fintech market benefits from creativity and talent. Renowned universities and London’s reputation as a financial centre have attracted the people and the brains needed to sustain and grow the sector. Around 76,500 people across the UK work in the industry with this set to grow to 105,500 by 2030.
At Appdrawn, we champion great software development talent and have brought together a team dedicated to building creative, effective solutions for our clients. You can find out more about members of our team on our blog, including Operations Manager, Colin Hirst; Consultant Mayowa Balogun; and MD and founder, Tim Kloss. Or contact us to discuss developing your own fintech or SaaS app. With the current environment of fintech investment, consumer buy-in, and the availability of technical expertise, now’s a great time to investigate opportunities in the market.