UK Government contributes to £16m fund for fintech Updraft
The ‘Future Fund’, a £500m initiative that opened for applications on 20 May 2020, aims to provide innovative, high growth and high potential British businesses with access to transformative funding during the COVID-19 pandemic.
Specialist investment firm is also contributing to the fund. Although exact figures on how the disclosed £16m has been split are unknown, the Future Fund initiative provides loans between £125k and £5m.
A truly unique offering
Founded in 2017 by Aseem Munshi, a former executive at HSBC, Updraft’s mission statement is to “help people break up with [their] credit cards” through its combined lending, credit report and financial planning platform.
Providing customers with a holistic view of their finances, a method of automating decisions and no overcharging fees, the company’s app managed to accrue a 40,000 person waiting list prior to release; it is now available from the iPhone app store.
Sarah Watts, Director at Quilam Capital, commended the Updraft team for using the available technology to produce a unique solution that addresses a prevalent issue in modern finance: credit.
“Over the years we’ve seen innovators making use of open banking, shed light on financial health and provide credit, however Updraft provides a truly unique offering across all of these aspects with a market leading solution to give customers the fairly priced credit they deserve.
“We’re delighted to invest in Updraft and support the business on their mission to give consumers the tools to save and reach their life goals faster.”
Innovating modern credit
Credit ecosystems are moving past their archaic and restrictive established guidelines and progressing towards something more inclusive, fair, and mindful of modern lifestyles. Lally says:
“We’ve seen tremendous growth in the types and diversity of predictive data attributes being used to assess consumer creditworthiness in lending decisions. This evolution is good news for lenders and consumers alike.
“At the same time, we’ve seen a shift in consumers’ willingness to contribute additional information if it increases their opportunities for credit access. One example is the success we’ve seen with , a free, first-of-its-kind tool launched in March 2019.
“[Boost] allows consumers to contribute their on-time telecom and utility payments, including Netflix, directly to their credit report for an opportunity to improve their credit scores. This marks a move toward greater consumer control in the credit scoring process.”
Findexable: COVID-19 hasn’t slowed down fintech investment
The release of Findexable’s 2021 Global Fintech Rankings report seems to confirm that the COVID-19 pandemic has had no deleterious effect on sector growth.
Compiled annually, Findexable’s report provides one of the most comprehensive surveys of global fintech. From regions to countries and individual cities, it compiles and analyses key performance data and gives insight into the leaders and up-and-comers.
In total, the company explored 264 cities across 83 countries and incorporated data from various media outlets, SEO databases, and over 60 fintech associations. CEO Simon Hardie spoke enthusiastically of the findings:
“The level of investment and activity in the fintech sector is hugely gratifying for those of us who have been championing the industry. It is especially good to see that the pandemic didn’t slow down, and may have in fact accelerated, the adoption of fintech in parts of the world that have previously been underserved.”
The leading hubs
Notably, there has been no movement in the 2021 list’s top three fintech hubs. While most others made incremental gains, it was Tel Aviv that made the most significant leap from 20th to 5th. Meanwhile, in a surprising shift, Singapore slipped from 4th to 10th:
- San Francisco Bay (same as 2020)
- London (same as 2020)
- New York (same as 2020)
- São Paulo (+1)
- Tel Aviv Area (+15)
- Berlin (+3)
- Boston (+1)
- Los Angeles (-2)
- Hong Kong (+2)
- Singapore (-6)
The leading countries
Findexable’s top 10 countries for fintech reflect the generally incremental shift observed among the hubs:
- US (same as 2020)
- UK (same as 2020)
- Israel (+9)
- Singapore (-1)
- Switzerland (same as 2020)
- Australia (+2)
- Sweden (same as 2020)
- The Netherlands (-2)
- Germany (+3)
- Lithuania (-6)
UK fintech has continued to ramp up at an accelerated pace: three new cities entered Findexable’s index for the first time, bringing the country’s total up to 13. The country remains fairly secure as Europe’s fintech leader, particularly as strong competitors like Lithuania fell in the rankings. However, Germany’s ascendance to the top 10 could indicate the beginning of a new challenger.
In North America, the US remains practically unchallenged by Canada. Meanwhile, both Australia and China have gained on Singapore, with the former seeming to be a likely APAC leader by 2022 if current trends continue.
As can be observed from the top countries and hubs, Israel’s fintech output has been proportionally one of the most impressive exhibited. It has claimed the top spot for MEA, followed by the UAE and Kenya - both of which also made significant gains. Finally, Brazil and Uruguay lead Latin America and the Caribbean.
Fintech: The global revolution
Reviewing the statistics compiled in Findexable’s report lends credence to Hardie’s words: fintech is greater than ever before and not even one of the world’s most disruptive events (COVID-19) has been able to prevent its growth.
Elliott Limb, Chief Customer Officer of Mambu, which sponsored the report, called every fintech part of a “global revolution” that is transforming financial services for the better.
“They are changing the way we save, spend, borrow, and invest money. Whether competing, cooperating or supporting traditional financial institutions, they are reshaping digital services for a real-time, on-demand world.
“Whether it is an aspiring unicorn, a neobank seeking new markets, a provider that wants to go digital, or a financial institution that wants to act like a fintech, you need a roadmap [...] a guide to where to begin and where to go. This is why a ranking system is important.