The title of "fintech capital" is commonly associated with London, supported by the growing number of fintech unicorns in the city valued at more than $1 billion, including Monzo and Revolut, and the fact that the U.K. receives more funding than any other European country.

However, fintech in the U.S. is giving the U.K. a run for its money, having seen a record investment of $52.5 billion across 1,061 deals in 2018. Currently, despite geopolitical volatility, trade concerns and increasing regulations, the fintech scenes in both countries look promising for 2019, and both appear to be going from strength to strength. How do they compare to each other?

The U.K. Fintech Landscape

In the first six months of 2019, the U.K. received a new high of $2.9 billion in funding and this growth is expected to continue for the remainder of the year. In addition, the U.K. is streets ahead of the U.S. on the digital banking opportunities it offers. For instance, Monzo now has more than 1.9 million U.K. customers, despite not having any physical branches, after enticing customers away from traditional banks with the promise of a better customer experience. The digital bank has aspirations to develop its offering even further to allow customers to do everything, such as switch energy providers in-app as it integrates with third-parties.

This level of digital banking innovation is yet to make its way across to the U.S., where card payment technology trails behind and consumers are often required to provide a signature when making a card transaction. In fact, contactless payments currently account for just a fraction of card transactions in the U.S., but by 2022 it is thought this trend will catch on to make up more than a third of electronic payments in America.

The U.S. Fintech Landscape

The  financial landscape in the U.S. is wildly different from the U.K.’s. The Federal Reserve Bank of San Francisco highlights that 30% of all consumer transactions in America are still paid in cash, while the average American also writes 38 checks a year, nearly five times the number of the average Brit. Additionally, the American mobile-payments industry is more than 50 times smaller than China’s.

Conversely, the U.S. is ahead in other areas. For example, San Francisco alone is home to nine fintech unicorns compared with London’s seven. Additionally, unlike the U.K., which has a single fintech hub in London, the U.S. benefits from a number of emerging fintech hubs, such as Atlanta, which is fast becoming a hive of fintech innovation, playing host to a variety of fintech start-ups, incumbents and technology accelerators. As home to payment companies including WorldPay and BitPay, Atlanta has earned the nickname “Transaction Alley.” Similarly, New York is producing new and exciting fintechs and benefits from a fast-growing pool of talent. Owing to its size, U.S. fintechs face less competition than London-based fintechs as they aren’t condensed into one area and benefit from a bigger playing field.

There’s no denying that the U.S. and U.K. both remain strong players in the fintech landscape. Yet, they are serving two very different markets and the fintech scene in each country reflects this, not least in terms of payment initiatives. However, with the introduction of the Financial Innovation Partnership (FIP) to promote cooperation on regulatory issues and business development in financial technology, we could see greater collaboration between the two markets resulting in a new wave of fintech innovation on both sides of the Atlantic.

Russell Bennett, CEO, Fraedom, has been a core part of Fraedom since it began in 1999. With over 20 years’ experience in FinTech, Russ is a leading expert in payments and expense technology. Visa completed an acquisition of Fraedom last year.