Since the announcement of Brexit many European countries have been attempting to benefit from the U.K.’s eventual removal from the EU. The latest country that could profit is Sweden, which is working to attract more FinTech investment.
According to a report from Breakit, an online Swedish news outlet, a report found that Sweden is the best in Europe at FinTech with the most investments over the past five years. The report found that for every million inhabitants, Sweden made over eight FinTech investments. The U.K. only had 5.2.
André Kerkorian, financial manager at the Swedish fintech company Northmill with the idea to simplify financial services, said that the U.K. leaving the EU could potentially fuel investment into the Swedish nation, reports Computer Weekly.
“Brexit is widely seen as a chance for Stockholm to increase its momentum and further establish itself as the European centre for fintech.”
Sweden Goes Cashless?
Sweden presents itself as an ideal location because it has already establishing itself as a forward-thinking country that is technology advanced.
The use of cash in the country has rapidly been declining with physical cash circulation dropping by 40 percent since 2009. In today’s tech-savvy world, Swedes are turning their attention to cards and digital payments for transactions instead of fiat.
As a result of the reduction in cash, a 2014 report stated that Sweden could become the first country to become a truly cashless society by 2030.
Regulatory Ease in Sweden
Another factor that could see companies flocking to Sweden after Brexit is down to the fact that Sweden enjoys a relatively easy regulatory environment for FinTechs to embrace.
During Fintech Stockholm 2016 it was announced that leading FinTech companies are forming a new lobby association, according to Northmill. Launched on Jan. 17, 2017, and known as the Swedish Financial Technology Association (Swefintech), its purpose is to provide a platform for the country’s FinTech community to speak with one voice.
Yet, while Sweden enjoys a good work-life balance, which could be a deciding factor for many companies looking to relocate their startups, London is still an attractive location for many companies.
London’s Regulatory Body
The U.K.’s Financial Conduct Authority (FCA) is increasing efforts to maintain London as the ideal location for startups to establish themselves.
By providing companies with the regulations they need to abide by, it is hoping to make the environment less of a mine field for countless businesses just starting out.
Not only that, but according to a BBC report, Sweden’s 20-year waiting list for rental homes could dampen many businesses thinking of relocating to Sweden.
It remains to be seen what impact Brexit will produce on the U.K. when it leaves the EU and if countries like Sweden will benefit as a result.
Featured image from Shutterstock.