Competition in the fintech sector is fiercer than ever, with cities across Europe all racing to be the region’s most active hub and most popular destination for investors. This comes as no surprise as the economic benefits of fostering a vibrant fintech ecosystem, as well as its ability to attract capital and top rate talent, are unparalleled. But there can be only one winner and according to new research from FinTech Global, the victory belongs to London.

London calling

The research found that of the total capital raised by all private European fintech companies in the first quarter of 2017, some 70% of it was directed to companies in London, Berlin, Stockholm, Paris, Barcelona and Amsterdam.

However, despite a cross-continent commitment to fintech, more than a third of the collective $1.164 billion recorded in fintech investments were attributed to London-based firms (36%). To contextualise this, London’s investments equate to three times more than the second-placed city, Berlin, who took up just 12%.

Yet, before London celebrates, it bodes well to remember that Berlin has as much as doubled its share from 6% to 12% in the last three years. Conversely, this does come at the expense of fintech firms from outside of the EU, who have seen their portion shrink from 31% to 25%.

For London, the research spells good news in a time of relative uncertainty and proves that Brexit be damned, the city will continue flourishing. In fact, this is a sentiment felt across the member states as other European cities are also seeing significant investment and growth in their respective fintech sectors. Nevertheless, whether London can preserve their position remains to be seen, especially as Brexit negotiations progress.

Elsewhere in Europe 

As already mentioned, Germany is enjoying a fintech boom. This is further bolstered by KPMG and CB Insights, after a report published by the companies concurred with its optimistic outlook. The German fintech sector was found to have raised $108 million in funding. Moreover, the three largest European rounds for fintech were all held in Germany, the most notable being the $40 million round raised by German digital bank N26.

The German fintech start-up sector is also benefiting as one in four were found to be alternative lenders (direct lending) and 17% were crowdfunding platforms. A further 27% were alternative payment providers and the rest were made up of companies who were active in insurance, ID verification or online shopping.

Meanwhile, Sweden is also closing in. As the second largest fintech community in Europe, it is tightening the gap with the UK. While the data groups together start-ups in Norway, Finland, Iceland, Sweden and Denmark, Sweden was found to be doing particularly well. Stockholm has seen payment companies such as Klarna (valued at $2.25 billion) and iZettle ($500 billion) push the nation forward.

For Sweden, this is just the beginning. According to the same KPMG report, investments in fintech companies in the country have risen year-on-year, resulting in a 106% increase in 2015 to $13.8 billion.