Chancellor Rachel Reeves has announced the creation of a £500 million Fintech Growth Fund designed to address the persistent Series B and C funding gap that has driven promising UK startups to seek capital from US-based investors. The fund, managed by British Patient Capital with cornerstone commitments of £100 million each from Barclays, HSBC, and Lloyds Banking Group, will co-invest alongside private venture capital firms in rounds between £20 million and £80 million. The Treasury is contributing £200 million from its National Wealth Fund allocation.

The initiative responds to years of lobbying from industry groups including Innovate Finance and the Fintech Founders network, which have warned that Britain risks losing its most promising scale-ups to Silicon Valley due to a lack of domestic growth capital. Research published by Beauhurst found that 62 percent of UK fintechs raising Series B or later rounds in 2024 were led by non-European investors, with many subsequently relocating their headquarters or primary listing ambitions to the United States. The new fund explicitly requires portfolio companies to maintain their UK headquarters for at least five years.

The first investments from the fund are expected to close in Q1 2026, with a pipeline of over 30 companies already under review. Eligible sectors include payments infrastructure, open banking platforms, insurance technology, and climate fintech. Economic Secretary Tulip Siddiq said the fund represents the most significant government intervention in fintech funding since the establishment of the British Business Bank. Critics, however, have questioned whether the headquartering requirement may deter the most globally ambitious founders from participating.