Investment in UK fintech companies totaled between $1.5 billion and $1.8 billion in the first half of 2026, marking the sector’s weakest fundraising half since 2016. Innovate Finance counted $1.8 billion across 181 deals, down 5% from $1.9 billion in the second half of 2025. Tracxn’s tighter methodology produced a lower figure of $1.5 billion, or about £1.1 billion, representing a 35% decline from its $2.3 billion total for H2 2025. Late-stage funding fell 45% to $830 million, while early-stage investment proved more resilient as investors favored a larger number of smaller bets. The UK nevertheless remained Europe’s largest fintech market and the world’s second-largest behind the United States, accounting for roughly 35% of all European fintech deals. US fintech investment reached $17.2 billion during the same period, about ten times the UK total. As funding conditions tighten, investors are shifting toward AI-related companies that can demonstrate long-term growth, while profitability, unit economics, cost reductions and improved risk management remain important criteria.