Key UK FinTech investment stats in Q1 2025:
- UK FinTech funding deal activity halved YoY as investors backed fewer but larger deals in Q1
- Projections show an expected decline in deal activity of 28% for 2025
- nsave, a UK-based FinTech enabling secure offshore accounts for individuals from high-inflation economies, closed one of the largest UK FinTech deals of the quarter with an $18m Series A round
UK FinTech funding deal activity halved YoY as investors backed fewer but larger deals in Q1
In Q1 2025, the UK FinTech sector experienced a marked downturn in both deal activity and funding compared to the same period last year.
Only 58 deals were recorded in the first quarter of 2025, representing a 52% drop from the 121 deals completed in Q1 2024.
Funding mirrored this trend, falling by 30% to $1.4bn in Q1 2025 from $2.0bn in Q1 2024.
Projections show an expected decline in deal activity of 28% for 2025
If the investment pace from Q1 persists over the next three quarters, the UK market would end 2025 with 232 deals and $5.7bn in funding, representing a 28% drop from the 323 deals and a 19% reduction from the $7bn raised in 2024.
Despite the overall contraction, the average deal value in Q1 2025 stood at $24.6m, a significant increase from the $16.7m average in Q1 2024.
This suggests that although fewer deals are taking place, the ones that are being executed involve larger capital commitments.
The data points to a shift in investor focus—away from volume and towards quality—as backers prioritise scale-ups and mature FinTech firms with proven business models amid an uncertain economic backdrop.
This trend of reduced deal flow but rising deal sizes reflects a more cautious but strategic investor sentiment within the UK FinTech landscape.
Market participants appear to be consolidating their portfolios, channelling funds into fewer, high-conviction bets rather than casting a wide net.
This aligns with broader global trends where macroeconomic headwinds and tightening capital markets are forcing both founders and investors to be more discerning in their engagements.
nsave, a UK-based FinTech enabling secure offshore accounts for individuals from high-inflation economies, closed one of the largest UK FinTech deals of the quarter with an $18m Series A round
The round was led by TQ Ventures and backed by Sequoia Capital, Y Combinator, ACE Ventures and Proton.
The company offers dollar, sterling, or euro accounts and has now launched an investment platform designed to protect and grow users’ wealth through access to US equities, ETFs, and managed funds.
By partnering with regulated financial institutions in the UK and Switzerland, nsave ensures compliance and safety, providing vital financial access to customers often excluded from traditional banking.
This latest funding will support nsave’s expansion across investment offerings and markets, leveraging its compliance-by-design approach to reach a growing base of users affected by global economic volatility and currency instability.
Source: https://fintech.global/
