Top Fintech News of 2016
A look at the top fintech headlines of the past six months.
Now that we are midway through the year, it’s a good time to look back and reflect on the top fintech news of 2016. It has been an interesting six months for the sector, with the biggest news coming unexpectedly at the end of June, when Britain voted “leave” to Brexit. And so, without further ado, read on to learn about 2016’s fintech highlights.
Britain votes “leave,” fintech responds
The biggest headline of the year is Britain’s decision to leave the European Union. On Thursday, June 23, a referendum was held to decide whether the UK should leave or remain part of the EU. Ultimately, the leave vote won by 52% (with 48% of voters hoping to stay). This decision had immediate impact on the fintech market, which had previously viewed London as a home for its innovation.
Reeling from the results of Brexit, the NYSE Fintech Index PR (INDEXNYSEGIS:NYOMFTX) fell by 8.39% between Friday, June 24 and Monday, June 27, marking one of the largest falls in the index’s history. Furthermore, the index hit its year-to-date low of $99.15 on June 27. The market seems to be recovering slightly, with prices rising after this historic low. However, it remains to be seen how the fintech industry reshapes itself in the wake of the UK’s departure from the EU.
Regional shifts for fintech
The uncertainty caused by Brexit has prompted some regional shifts in the fintech market. Although the impact is still incredibly new, commentators are looking to diverse regions (specifically Asia) to hold the new fintech crown. These regions seem comparatively stable and already have a significant amount of tech investment dollars flowing through. Although only time will tell, one of the biggest headlines that we have seen in 2016, and will continue to see as the year goes on, is the geofinancial implications of Brexit. No matter who comes out on top, investors can be sure to see some fairly significant regional changes in the coming months.
Fintech employment opportunities abound
Despite all of this uncertainty, the fintech market is actually in a really strong space this year. While other tech sectors have been lagging, with a languid IPO season and slowing investment, the fintech space has continued going strong. This momentum has created a strong job market in the fintech sector, as recent graduates look for options beyond the traditional banking sector.
In the next six months, therefore, we should continue to see more and more fintech investment – even if it’s not centred around London, as previously expected. Investors can rest assured that the market is heading on to big things in 2016 and 2017. But first, they have to ride the wave of uncertainty caused by Britain’s historic decision to leave the EU.
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Securities Disclosure: I, Morag McGreevey, hold no direct investment interest in any company mentioned in this article.