European FinTech takes a hit in Q3

European FinTech deals fell by 17% while overall FinTech funding in Europe dropped 43% compared to Q2, according to research from KPMG.

Overall FinTech funding for Europe stood at $233 million across 38 deals in Q3 2016 compared to $369 million across 43 deals in Q2.

The research suggests that the UK’s decision to leave the European Union at the end of June and the decision’s resulting impact on growth expectations and interest rates could be a factor.

The report also suggested Europe has yet to see a FinTech ‘mega-round’ when it comes to venture capital (VC) backed FinTech companies as it has yet to record a $50 million plus financing round in 2016.

Other results show Germany attracted more VC FinTech investments than the UK for the second successive quarter, attracting $105 million compared to the UK’s $78 million.

It also claims efforts are currently underway to further promote the FinTech space in Germany and establish ecosystems in Berlin and Frankfurt in an attempt to move start-ups away from London.

In spite of the results, Patrick Imbach head of KPMG tech growth for KPMG in the UK, suggests that the UK can still succeed in the FinTech space.

“The UK is still well-positioned to maintain its spot as a FinTech powerhouse. Post-Brexit, the UK may even be able to offer advantages over other European nations that can enable FinTech to thrive,” said Imbach.

Outside of Europe other results revealed Asia was the only continent to see a funding increase on a quarterly basis in Q3 with overall Asia FinTech funding standing at $1.2 billion across 35 deals.