Increased scrutiny from investors
The last 12 months have been challenging for the sector, says Taylor Wessing. Despite investor confidence being shaken at the beginning of 2025, the fintech industry in Europe completed the year with an overall 7% year-on-year increase in capital invested, Taylor Wessing says, with the UK being a particularly strong sector.
The reports suggests that investors will be focusing on fintech profit in 2026, driving fintech consolidation.
Verena and Miroslav argue that the payments sector will continue to be a so-called “darling” of venture capital investors due to the increased competition amongst incumbent institutions, fintech scale-ups that are yet to prove their valuations and new entrants.
Pending regulatory reform in the European Union combined with the increasing number of providers looking to leverage innovative technology for payment purposes (from stablecoins to agentic AI) will be some of the primary catalysts for this.
The maturing crypto ecosystem in the EU is also expected to serve as a fertile breeding ground for the growth of European fintechs operating in the crypto sectors. This is not expected to stop at the regulatory perimeter of the EU Markets in Crypto-Assets (MiCA) Regulation, they say.