Need-To-Know: 24 Statistics On The State Of UK FinTech ESG

Written by Sabrina McClune | 07 04 22

As the world embraces ESG initiatives, FinTech plays a key role in transforming financial services. Here are 24 FinTech ESG statistics every leader should know.

FinTech is crucial in shaping the future of ESG, offering tailored digital solutions to replace harmful practices and help firms measure their climate impact.

We’ve gathered the top 24 statistics to illustrate the current state of FinTech ESG and the trends expected to emerge.

FinTech Investment Is On The Rise

1. The FinTech market, valued at $127.66 billion in 2018, is projected to grow to $309.98 billion by 2022.

2. This surge is driven by $120 billion invested in sustainable projects in 2021.

3. Consequently, 151 new unicorns (startups valued over $1 billion) entered the market in a record-breaking year.

“ESG regulations and guidance will drive risk management going forward. New rules on disclosure and green investments increase compliance risks for financial institutions.”

— Hannah Tindal, Head of Directors and Officers, AGCS

Industry Need Is Rapidly Growing

4. A survey found that 80% of financial services professionals rank ESG as a critical or the most important issue for their operations.

5. Two-thirds of leaders believe ESG considerations have grown in importance due to Covid-19.

6. Yet, 42% admitted they have ineffective processes or no processes at all for handling climate threats and ESG factors.

“Financial services firms face growing pressure to integrate ESG issues into decision-making. Stakeholders are increasingly vocal about the link between ESG focus and business sustainability.”

Source: Aferm.org

Consumer Demand Is At An All-Time High

7. 44% of surveyed consumers consider ESG issues crucial when selecting a financial provider.

8. One-quarter of customers might switch banks over ESG concerns.

9. 86% of UK consumers are now regularly using FinTech services.

“With the rise of ESG investing, fund managers require robust ESG data, tools, and analytics for informed decision-making.”

— Jason Stevens, CTO, Ultimus Fund Solutions

Key ESG Focuses For FinTech

10. Among the newest FinTech startups, popular categories include carbon offsetting and carbon accounting.

11. An example is CarbonChain, a UK-based company providing carbon accounting products and facilitating access to green financing.

12. Other FinTech aims include ESG reporting, climate risk management, and sustainable banking and supply chain analytics.

“Consumer demand is increasingly impacting corporate finances. People expect companies to conduct business ethically and transparently.”

— Source: KPMG

FinTech As A Movement For Transition

13. Nearly three-quarters of banking CEOs believe their growth hinges on their ability to transition to a low-carbon, clean technology economy.

14. Research indicates FinTech developments assist economies in shifting to low-carbon models by reducing greenhouse gas emissions.

15. Technology can reduce carbon emissions by up to 20% by 2050 through various initiatives like loans for renewable projects, savings accounts for tree-planting, and secure email systems that cut down on paper usage.

"Our spending choices reflect our values, making it crucial to understand the impact of our money. Transparency in banking allows us to take responsibility for our financial impact."

— Zoe Sear, Head of Communications at Triodos

Big Brands Are Stepping Up

16. NatWest is providing SMEs with digital tools to help them go green as part of its £100bn Climate and Sustainable Funding and Finance initiative.

17. JPMorgan has committed $2.5 trillion to lending, investing, and funding organisations addressing climate change and inequality.

18. Mastercard, Finaro, and GoTo are partnering to plant 1 million trees by 2025 as part of their ESG efforts.

“The next generation of ESG leaders will need to be more senior and agile to be effective in the evolving landscape of ESG.”

— Harvard Law

Impact Investing Is Gaining Popularity

19. The impact investing market has grown by 40% recently, now valued at $715 billion.

20. In the past decade, 40% of consumers have sought assurance that their investments do not support polluters.

21. Social project investments are also on the rise, with brands like PayPal pledging $530 million to support Black and minority communities.

“As businesses increasingly commit to ESG principles, technologies will be crucial in achieving transparency, privacy, and accountability.”

— Chris Marsh, S&P Global Market Intelligence

Top Technologies For FinTech Use

22. An ecosystem of technologies is enabling FinTechs to drive green initiatives. Deloitte identifies five key technologies for FinTech: blockchain, AI, security, the internet of things, and the cloud.

23. Cybersecurity adoption is rising sharply as financial firms are 300 times more likely to be targeted due to the sensitive data they handle.

24. Solutions like Mailock secure email provide essential security features, such as encryption and two-factor authentication, used by nearly 80% of people in some form by 2021.