Optimism is returning to Europe’s fintech sector, according to new research from MHP Group, which reveals that more than three quarters of firms anticipate growth over the next 12 months.
After a challenging couple of years for the industry, MHP conducted interviews with over 50 fintech leaders from the UK, France, Germany, Italy, and Spain regarding their future expectations.
Confidence is generally rising within the European fintech sector. UK leaders exhibit the highest optimism, with 83% predicting growth in the coming year. The figures for other countries are France at 80%, Germany at 77%, Spain at 72%, and Italy at 66%.
Established fintech companies, particularly those over 10 years old, exhibit a stronger expectation of growth (79%). In contrast, younger firms—those under five years old—are slightly less confident, with 55% forecasting “significant” growth in the next 12 months.
This renewed confidence is accompanied by a stronger emphasis on achieving profitability, which is a top priority for over two-thirds of respondents. Attracting customers, securing investors, and acquiring talent are recognized as the three most critical factors for achieving profitable growth, showing consistent trends across different markets, business maturity, and sizes.
Customer acquisition and retention is identified as the leading priority for 55% of fintech businesses, with this number rising to 71% among Italian firms. Larger and more established players tend to prioritize this more than smaller or newer companies.
Securing funding is also a significant focus, with 45% of European fintech leaders identifying capital injections as essential for driving growth.
Moreover, European fintechs are not only competing among themselves for talent but also against the broader tech ecosystem, including well-funded companies from America, Asia, and the Middle East, where compensation and benefits can be more appealing. Consequently, 40% of respondents intend to prioritize talent acquisition in the next year.
Nick Woods, head of financial services at MHP Group, states: “The sense of optimism returning to Europe’s fintech sector represents more than just a shift in sentiment. After a challenging period, experienced leaders are using their hard-earned insights to inform their growth strategies. The previous era of readily available funding and a ‘scale at all costs’ mentality has shifted to a more disciplined focus on profitable growth, marking the beginning of a more mature approach.”