China’s fintech cities face challenges in global rankings amid regulatory shifts
Singapore solidified its status as Asia’s leading fintech hub, securing the fourth position in the Savills’ FinTech Index published by Savills World Research.
The Lion City surpassed its Chinese counterparts, thanks to substantial investments and a stable global regulatory environment.
Singapore’s fintech sector attracted a remarkable US$34 billion in venture capital investments from 2019 to 2022, making it a standout performer. Additionally, it hosts the world’s largest fintech festival.
The city-state boasts global regulatory stability, with the Monetary Authority of Singapore establishing agreements with regulators worldwide.
The Savills 2023 Tech Cities Index evaluated cities based on their business environment, tech environment, city buzz & wellness, talent pool, as well as its strength across tech sub-sectors such as industrial tech, life sciences & health tech, fintech, and e-commerce, amongst others.
New York, San Francisco, and London top global ranking
Singapore secured the fourth spot in the index, trailing behind New York, San Francisco, and London.
New York stood out for its robust demand for fintech innovation, substantial capital resources, and a deep talent pool.
Meanwhile, London was named Europe’s leading fintech hub since it has the highest number of fintech companies globally. It also witnessed the most VC deals from 2019 to 2022.
The third and fifth positions were clinched by San Francisco and Silicon Valley, which are renowned tech hubs serving as the home for companies like PayPal, Stripe, Credit Karma, and other fintech startups dubbed “revolutionary” by Savills.
“Technology has allowed cities across the world to level the playing field in the game of finance, which has led to a diversification of hubs away from historically traditional financial centres,” according to Savills.
Meanwhile, Chinese cities faced challenges in advancing their positions due to tightening government policies.
Despite 87% of Chinese consumers using at least one fintech service, cities like Shenzhen, Shanghai, and Hangzhou found themselves in the middle of the index due to recent restrictions on tech companies’ reach. The dominance of major players like Ant Group and Tencent also resulted in lower VC funding for Chinese fintech startups globally.
On the other hand, U.S. cities such as Boston, Chicago, Miami, Atlanta, and Charlotte, occupying positions nine through thirteen on the index, leveraged North America’s position as the world’s largest economy to provide startups with opportunities to secure prominent clients while keeping costs down.
“Having lower office rents than the cities at the top of the index, they have the cost advantage which enables them to push cheaper products or spend more on developing products,” the real estate services company noted.
“Fintech businesses have been a boon to the flexible workspace sector and continue to occupy a significant number of desks in Singapore,” stated Ashley Swan, Executive Director of Commercial Leasing.
“The collaborative and flexible nature of the spaces speak to the FinTech culture and their “start-up” ethos, allowing firms to remain agile as they grow, not only in Singapore, but the region. In addition, regular activities and events organised by operators lend to Fintech employee’s wellbeing and work-life balance,” Swan added.
More from OMY: Singapore FinTech Festival highlights AI
