The UK is a longstanding player in the banking market, offering financial services an attractive sandbox for new startups and technology.
Over the past decade, FinTechs have been an attractive target for investors, and although purse strings have tightened with respect to funding, the interest has not diminished. According to a CBI Insights report, Banking-as-a-Service (or BaaS) startups have become an attractive target for acquisitions and have driven up the M&A in this sector. Specialised PE and VC firms, along with major legacy banking brands have continued to show interest in the sector.
Even though all indicators say that BaaS is here to stay for large financial service institutions, and will continue to attract investment, it remains to be seen how this burgeoning sector will establish itself in the traditional banking market of the UK.
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