Around 60% confirmed they were adapting their strategy to survive the Covid-19 pandemic and its resulting economic shockwaves, with 32% of those saying they would diversify their revenue, and 30% saying they would ‘pivot’ the business to stay afloat. Around 11% of those adapting their strategies said they may ‘mothball’ their business altogether for the for the foreseeable future, or closing outright.
Small businesses across the industrial gamut have availed themselves of Government support in the UK to survive the current downturn, and FinTech start-ups are no different. Three in four of the firms surveyed told Innovate Finance that they had applied for Government support either through Bounce Back loans or furloughing. However, Charlotte Crosswell, CEO of Innovate Finance, said that many FinTech companies have been unable to take advantage of current support schemes due to their growth profile.
Urging action, Crosswell explained, “It’s evident that the FinTech sector faces a significant funding gap as a direct result of Covid-19,” she says. “We need to act fast before it’s too late. If we fail to address this, we risk losing many companies in the fastest-growing sector in the UK economy. We cannot turn our backs on the start-ups now or we will pay the price later down the line.”
Saka Nuru, Head of Product Marketing for Fintech Ecosystems and Payments at Intuit Quickbooks, commented:
“Over the past decade, the UK has positioned itself as a global leader in the fintech space: carving a reputation for supporting innovative start-ups, and nurturing some of the world’s foremost leaders in this space. And whilst Covid-19 has hit an abundance of industries very hard, and many businesses are beyond the point of recovery, it’s absolutely imperative that the same fate does not befall smaller fintechs – who have been the backbone of British business and our economy for many years.
“Thus, moving forward, we should hope to see continued support from the government in order to help the fintech industry remain buoyant during these final, difficult moments of Covid-19. Furthermore, despite the difficult economic climate, investors should surely see the fintech startup space as one of the most lucrative investable assets at this time – not only is fintech a proven gold mine for young talent, and world leading companies, but times of difficulty have been proven to birth durable and ground-breaking companies, for which savvy investors could help rejuvenate.”
