Scotland emerged as the second-largest UK hub for financial services foreign direct investment (FDI) last year, trailing only London. A new report shows the country clinched 11 major FDI projects in 2024, marking its highest tally in ten years.
This boost in foreign investments underlines Scotland’s growing appeal as a financial centre outside the capital, despite ongoing economic uncertainties and global shifts. The findings come from the latest survey by EY, a leading accountancy and advisory firm.
Scotland’s Rise in Financial Services Investment
In 2024, Scotland attracted 11 financial services FDI projects, up from nine in 2023, according to EY’s UK Attractiveness Survey. This marks the highest number of projects secured in a decade, reflecting a notable uptick in investor confidence in Scotland’s financial sector.
London continues to dominate the landscape, but Scotland’s performance signals a growing shift of attention towards regional financial hubs. Edinburgh, Glasgow, and Aberdeen have become magnets for foreign firms seeking a stable yet dynamic environment outside the capital’s shadow.
Interestingly, Scotland accounted for nearly 20% of all UK financial services FDI projects last year, a significant slice considering the fierce competition from cities like Manchester and Birmingham.
This rise aligns with the country’s focus on building a competitive business environment through incentives, skilled talent pools, and improved infrastructure.
What’s Driving the Surge in Scotland’s FDI?
Several factors contribute to Scotland’s success in attracting foreign investment to its financial services sector. Experts highlight the combination of established financial expertise, a growing fintech scene, and government support.
Scotland’s universities churn out finance and technology graduates each year, ensuring firms have access to a skilled workforce. This is a huge draw for international companies seeking innovation without the sky-high costs of London.
Government initiatives have played a key role too. The Scottish Government’s push to make Scotland a global financial centre includes tax incentives and support programs tailored to foreign investors.
There’s also the appeal of a stable regulatory environment and access to UK-wide and European markets, despite Brexit-related uncertainties.
Moreover, Scotland’s quality of life and lower operational costs compared to London create a compelling package.
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Competitive office rents and business rates in cities like Edinburgh attract startups and established firms alike.
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Growing clusters of fintech companies offer collaborative opportunities.
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Digital infrastructure improvements make remote and hybrid working seamless.
It’s a cocktail that’s evidently working for Scotland’s financial services FDI numbers.
A Closer Look: How Scotland Compares with Other UK Regions
Though London reigns supreme with 39 FDI projects in financial services in 2024, Scotland’s 11 projects show it’s the most successful UK region outside the capital.
The table below highlights the financial services FDI projects across key UK regions in 2024:
| Region | FDI Projects in Financial Services | % Share of UK Total |
|---|---|---|
| London | 39 | 53% |
| Scotland | 11 | 15% |
| Greater Manchester | 7 | 10% |
| Birmingham | 5 | 7% |
| Other Regions | 11 | 15% |
The numbers underline Scotland’s firm grip on a substantial share of the market outside London, beating other major cities like Manchester and Birmingham.
This isn’t just about quantity. Quality matters too. Many of the projects involve cutting-edge fintech ventures, asset management firms, and insurance companies looking to establish or expand their presence in Scotland.
What This Means for Scotland’s Economy and Jobs
The inflow of FDI projects has tangible effects on Scotland’s economy and job market. Foreign investment often brings new jobs, boosts innovation, and fosters collaboration.
Analysts estimate that each FDI project supports dozens of jobs, from entry-level roles to highly skilled positions. Plus, these investments tend to have multiplier effects, attracting local suppliers and service providers.
The financial services sector in Scotland currently employs around 120,000 people, contributing billions to the economy annually. With new foreign projects coming in, this number is expected to rise.
But it’s not just about the numbers. The sector’s growth could enhance Scotland’s global reputation, attracting even more investors and encouraging homegrown firms to scale.
Still, challenges remain. Talent retention, regulatory changes, and global economic uncertainties could impact future FDI flows.
Yet, the recent trends offer a positive outlook.
The Scottish Government has expressed optimism, calling the results “a strong endorsement of Scotland’s competitiveness and resilience.”
Investors Speak: Why Scotland Stands Out
Several foreign investors have publicly praised Scotland’s financial sector in recent months. They cite a welcoming business climate and a blend of tradition with innovation.
One fintech CEO noted, “Scotland offers an excellent ecosystem with access to talent, supportive local authorities, and a community that’s eager to embrace new technologies.”
Another asset management firm executive said, “The quality of life here makes it easier to attract and keep top professionals, which is a big deal in this industry.”
Such testimonials add weight to the data, painting a picture of Scotland as a thriving hub for financial services beyond the usual London spotlight.
