UAE defies fintech slowdown with a 92% jump in funding — against a global plunge of 48%
Europe’s fintech sector is fiercely competitive, with privately-held start-ups worth tens of billions of dollars vying to steal market share from incumbent banks.
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The fintech industry saw more pain in 2023, with overall investment falling by half as higher interest rates and worsening macroeconomic conditions caused investors to tighten their belts, according to global investment figures shared exclusively with CNBC.
The data from Innovate Finance, a financial technology industry body, shows that investment in fintechs last year sank $51.2 billion, down 48% from 2022 when total investment in the sector totaled $99 billion. The total number of fintech fundraising deals also sank considerably, to 3,973 in 2023 from 6,397 in 2022 — a 61% drop.
Still, despite that drop, there was one standout performer on Innovate Finance’s list when it came to funding: the United Arab Emirates. According to Innovate Finance, the UAE saw total investment soar 92% in 2023, thanks in part to more fintech-friendly regulations, and as adoption of digital banking and other tools expanded in the region.
That marks the first time the UAE has made it to the top 10 list of most well-funded fintech hubs in 2023, according to Innovate Finance. There were more Asian and Middle East countries in the top 10 last year than there were European nations, the group noted, as some major European economies slipped down the table, such as France and Germany.
“Some of the markets now adopting this technology, we’re seeing that reflected in investment numbers,” Innovate Finance CEO Janine Hirt told CNBC earlier this week. Hirt noted that the momentum in Asia and the Middle East offered an opportunity for the U.K. to boost cooperation and partnerships with countries in those regions. “We are seeing appetite and real momentum coming from a lot of hubs in Asia,” she said.
On the slowdown, Hirt noted that growth-stage companies were the most likely to be affected by the downturn in funding in 2023, whereas seed-stage and early-stage firms were more immune to those pressures.
“If you’re a later-stage company, you might not be going out for a raise right now,” Innovate Finance’s CEO said, adding that early-stage fintechs had a better time in the market last year raising about $4 billion. “That’s a really positive sign,” she added.
“What is a testament to the strength of our sector is that deal sizes are very, very healthy,” Hirt said. “Globally, and in the U.K., investment in seed, Series A and B fintechs has normalized, which is a testament to the strength of investors,” she added.
Financial technology has had its share of gloom over the past 12 months, amid intensifying conflicts between Russia and Ukraine and Israel and Hamas, ongoing geopolitical tensions between the U.S. and China, and broader uncertainties affecting financial markets, such as higher interest rates.
According to the International Monetary Fund, global economic growth is expected to slow to 3% in 2023 from 3.5% in 2022.
UK comes second to U.S.
Innovate Finance also noted that the U.K. was the second-biggest hub for fintech investment in 2023, with total funding for the country’s financial technology industry totaling $5.1 billion in 2023, down 63% from $13.9 billion in 2022.
The U.K. received more investment in fintech than the next 28 European countries combined, according to Innovate Finance.
London fintechs pulled in $4.5 billion last year, with the city continuing to dominate when it comes to fintech funding in Europe more broadly.
However, the U.K.’s capital saw overall funding drop, too — down 56% from 2022.
Meanwhile, female-led fintechs in the U.K. bagged 59 deals year worth a combined $536 million, according to Innovate Finance, accounting for 10.5% of the U.K. total, which the organization called a “step forward” for women founders and leaders.
“I think, ultimately, the U.K. is still very much a global leader in fintech,” Hirt told CNBC. It’s the European leader.”
But, she added, “We can’t afford to rest on our laurels. It’s critical to build on the momentum we’ve had over the past few years. We need government support and regulation that is effective and efficient and proactive.”
“For us, a focus going forward is making sure we do have proper regulation in place that allows fintechs to thrive, and allows SMEs [small to medium-sized enterprises] across the country to benefit from these new innovations as well.”
“Cracking on with new regimes for stablecoins, regimes for crypto, open banking and finance — these are all areas we’re hopeful we’ll see progress in in 2024.”
The United States, unsurprisingly, was the biggest country for fintech investment, with total investment coming in at $24 billion, although funding levels remained down from 2022 as fintech firms raised 44% less in 2023 than they did a year ago.
India came in third after the U.K., with the country seeing fintech investment worth $2.5 billion last year, while Singapore was fourth with $2.2 billion of funding, and China was fifth on $1.8 billion.
The value of the top five biggest deals globally in 2023 was over $9 billion, or about 18% of total global investment in the space.
Stripe pulled in the most amount of cash raising $6.9 billion, according to the data, while Rapyd, Xpansiv, BharatPe, and Ledger won the second, third, fourth, and fifth-biggest investment deals, respectively.
Charges against Jeffrey Epstein were announced on July 8, 2019 in New York City. Epstein will be charged with one count of sex trafficking of minors and one count of conspiracy to engage in sex trafficking of minors.
Stephanie Keith | Getty Images News | Getty Images
Elon Musk, Peter Thiel and former Trump White House advisor Steve Bannon are among those who appeared in partially redacted files related to the late convicted sex offender Jeffrey Epstein that were released on Friday by Democrats in the House Oversight Committee.
The committee earlier embarked on a probe to evaluate whether the federal government mishandled its case against Epstein and co-conspirator Ghislaine Maxwell, who is serving a 20-year prison sentence following a 2022 conviction for recruiting teenage girls to be sexually abused by Epstein.
President Donald Trump had promised voters on the campaign trail that he would release government documents related to Epstein, who was arrested in the summer of 2019 on sex trafficking charges and died in a New York federal prison, reportedly by suicide, before trial.
However, Trump has refused to endorse the release of any Epstein files since returning to the White House in January, and Republicans in Congress have followed his lead, keeping the documents out of the public’s view.
Democrats in the committee on Friday released redacted pages from a new batch of files they obtained through their probe without giving their Republican peers advanced notice. They were rebuked for the move.
In a statement on Friday, the committee said that the batch included 8,544 documents in response to a subpoena in August, and that, “Further review of the documents, which were redacted to protect the identity of victims, is ongoing.”
The latest batch of documents received by the committee from the Justice Department contained itineraries and notes by Epstein memorializing invitations he’d sent, trips he’d planned and meetings he’d booked with tech and business leaders.
Demonstrators gather for a press conference calling for the release of the Jeffrey Epstein files outside the United States Captiol on Wednesday September 03, 2025 in Washington, DC.
The Washington Post | The Washington Post | Getty Images
One of the itineraries indicated that Epstein expected Musk to make a trip to his private island in the U.S. Virgin Islands on Dec. 6, 2014, but then asked “is this still happening?”
Musk told Vanity Fair in 2019 that he had visited Epstein’s New York City mansion and that Epstein “tried repeatedly to get me to visit his island,” but the Tesla CEO had declined.
In June, Musk wrote in a post on X, that he thought Trump and his administration were withholding Epstein-related files from the public view in order to protect the president’s reputation.
“Time to drop the really big bomb: @realDonaldTrump is in the Epstein files,” Musk, who was in the midst of a public spat with the president, wrote at the time. “That is the real reason they have not been made public. Have a nice day, DJT!”
Trump was mentioned in previously released court documents from the Epstein case, but has not been formally accused of wrongdoing.
Musk started the year leading the Trump administration’s Department of Government Efficiency (DOGE), an effort to slash the size of the federal government and reduce the power of various regulatory agencies. He left DOGE in May, and he and the president proceeded to hurl insults at each other in public over a number of disagreements.
However, Trump and Musk remain close enough that they sat together at a memorial service for Charlie Kirk earlier this month after the right-wing activist was assassinated while speaking at a university in Utah.
The partially redacted files also indicated Epstein had breakfast with Bannon on Feb. 16, 2019, and lunch with investor Peter Thiel on Nov. 27, 2017. Bannon is a long-time Trump ally, and Thiel was a major backer of Trump ahead of the 2016 election who spoke at the Republican National Convention.
The files also mentioned that Epstein booked a “tentative breakfast party” with Microsoft founder Bill Gates, historically a supporter of Democrats, in December 2014.
Musk, Thiel, Bannon and Gates weren’t immediately available for comment.
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