UK fintech funding dropped significantly in the first quarter of the year, according to the latest quarterly report from data intelligence platform Tracxn.
According to the report, UK fintechs raised $741m (£544.2m) in the first three months of the year, a decline of 43% compared with the last quarter of 2025.
The amount of funding raised also represents a 17% decline compared with the first quarter of last year.
The report has claimed that “late-stage compression” was behind the decline, with later-stage rounds in the sector falling 62% from the fourth quarter of 2025.
Despite the reduction at the late-stage, early-stage funding soared over the period. Early-stage UK fintechs raised $276m (£202.7m) in Q1 2026, up 35% from the end of last year and an enormous 177% increase from the start of last year.
Tracxn described the new figures as less of a decline and more a realignment of investment structures.
The top rounds recorded in the sector over the period were 9fin Technologies’ £130m Series C round and Allica Bank’s £115m Series D round. In both cases the firms secured unicorn valuations.
