Who has the better fintech market - the US or Europe?

 Gus Mallett photo
Gus Mallett Content Writer
3min read

The US fintech scene is moving like a bat out of hell. But experts have pointed out it was pretty late to the party.

Europe tasted success about five years ago and is showing no signs of slowing down. So, today, where’s the best place to set up a financial services company? Let’s get into it.

What’s the US fintech market like at the moment?


The States is home to a combination of mature institutions operating at huge scale - Chime, Current, Bond, etc. - and start-ups bringing cutting-edge propositions to market.

Let’s look at the numbers. According to KPMG, $51bn was invested into the Americas in the first half of 2021 - accounting for more than half of fintech investment globally. The EMEA region netted $39.1bn in that time.

More than half of the world’s fintech unicorns are based in the US. And so is a raft of the most valuable private and listed companies by market capitalisation. Your Paypals, Squares, Stripes, Coinbases and Robinhoods. Our obsession with valuations is a little overblown, yes, but the figures tell a story.

More than half of the world’s fintech unicorns are based in the US.

The US has a few advantages up its sleeve. It’s massive. Like really really big. It has everything you need. The total addressable market, talent pool, investors. They’re all there, already. Expanding into other markets just isn’t a necessity.

In the last couple of years, New York has emerged as a hub for fintech goings-on. A large chunk of Stripe’s workforce has migrated to the East Coast from its home in Silicon Valley. Covid is a factor. But the fintech opened an office near Wall Street as early as September 2019. Before words like ‘furlough’, ‘social distancing’ and ‘lateral flow’ had entered public lexicon. Better times.

The move is a bit of a flex. For all of San Francisco’s success in the tech start-up space, Wall Street is still top of the financial food chain. Not to mention stacked with talent.

In the US, failure is looked at through a positive lens. It’s a lesson and an opportunity. Next time will be better. Or it won’t. But the time after that (or maybe after that) will be. Keep plugging away and you’ll get there. In the UK and Europe, failure is failure. Avoid it at all costs.

What about the European fintech market?

It’s diversified, disruptive and deep-pocketed.

The European market can lay claim to some very forward-thinking regulators and policymakers. Open Banking and GDPR testify to that. Consumers are mindful of their data and how it can be leveraged to help them access better financial services.

PSD2 was introduced nearly four years ago to propel Europe to the forefront of open banking. Whether or not that’s happened is a matter for debate. But there’s no denying the huge promise in this area. One to keep an eye on.

European investors are great for pre-seed and seed funding but rarely lead the big rounds. Your As, Bs and Cs. That’s one area where the US ecosystem really distinguishes itself.

The UK, in particular, does have one noteworthy card up its sleeve - London. It’s the happening place to be (even if this article penned by yours truly makes a pretty convincing case for France).

The UK, in particular, does have one noteworthy card up its sleeve - London.

London has tech talent to rival Silicon Valley and a financial hub to make the Big Apple green with envy. And policymakers by the dozen. All within a few tube stops of each other. It’s fertile ground for fintech.

More widely, European universities play host to 35 of the world’s top computer science degrees. Germany is the centre of innovation with over 25,000 patents granted during 2020 alone.

And France deserves more than a nod of recognition. Spendesk recently became the fifth fintech to reach unicorn status in 2022. President Emmanuel Macron wants a tech dynasty to rival our American cousins and reduce reliance on the US. He has his sights set on 10 European tech giants valued at €100 billion by 2030. Now that would be interesting.

So…which market is better?

Hmm. That’s a tricky one.

Right now, probably the US. But this race isn’t run. We’ll be keeping track of it every step of the way. And check out the latest Insights episode of our Fintech Insider podcast. We rounded up some great guests with operations on both sides of the pond to make their cases.