The 2021 Global Fintech Rankings, compiled by Findexable, also showed the fintech space outside of the capital and throughout the rest of the UK is expanding at a rapid pace. This is evidence Brexit and the current Covid pandemic has had next to no impact on London's start-up scene, with the City's fintech space predominantly powered by the growing "challenger bank" sector.
The newly-published Index, which first came out in 2019, ranks the fintech ecosystems of more than 264 cities across 83 countries, using Findexable’s data from its own records.
Data has also been collated and verified by the industry’s Global Partnership Network, which includes more than 60 fintech associations around the world.
London remains second behind San Francisco, and despite making a number of substantial gains since last year's Index, EU countries have been unable to unseat the capital in the rankings.
EU cities such as Berlin have risen three places to sixth and Stockholm jump 21 positions to 14th, while Moscow and Zurich both moved up 12 spots to 18th and 26th respectively.
Hamburg leaped 13 places to 30th but in a major blow for the Brussels trading bloc, Paris plunged 21 positions to a lowly 36th.
But the latest Index also shows massive progress for a number of UK cities outside of London as the country continues to defy gloomy post-Brexit forecasts.
The latest rankings show two UK cities have made it into the top 50.
Manchester has climbed 19 places to 34th position, while Cambridge surged into the top 40 by jumping a massive 55 places to 38th position.
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"We have even seen fintech companies emerge in towns like Macclesfield, Ashford, Caerphilly and Inverness.”
He added: “It is part of a greater push toward bridging the gap between companies and their customers that we have identified happening across the world since the annual report started in 2019, but which has accelerated in the last 12 months as a result of the pandemic driving more people to use digital finance.
"Where there are more customers there will be more businesses, and in an innovation-driven sector like fintech that translates to greater chances for new ideas that can shake up the entire industry.”
Mambu Chief Customer Officer Elliott Limb, chief customer officer of cloud banking platform Mambu, said: “Fintechs are part of a global revolution to make financial services easier, faster and simpler, and the UK is a major part of this.
"They are changing the way we save, spend, borrow, and invest money.
"Whether competing, cooperating or supporting traditional financial institutions, they are reshaping digital services for a real-time, on-demand world.”
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