Chancellor of the Exchequer, Phillip Hammond MP, has pledged government support to the ongoing development of UK fintech at the first International FinTech Conference.
Writing in The Times ahead of his appearance at the conference, Hammond spoke of the achievements in the sector.
“Fintech is changing the way we bank and is one of Britain’s most exciting industries,” the Chancellor wrote.
“Today we will bring together more than 100 of the UK’s most exciting fintech firms with investors from every continent, so they can showcase their innovative products and investment plans. My message to this audience will be simple. First, because Brexit will open the doors to new opportunities, with enhanced business relationships, new jobs and more investment, British fintechs must not rest on their laurels but seize the enormous opportunities ahead.”
“There is absolutely no reason why the UK shouldn’t be home to even more start-up fintechs, such as the hugely successful British firms Funding Circle and TransferWise, worth more than $1 billion.”
Taking to the stage as conference host later in the day, Phillip Hammond commended the entrepreneurial spirit displayed by the innovations and great strides made in British fintech. He highlighted the £7 billion revenue generated last year in the sector, and noted the 60,000 people now employed under the banner of fintech.
However, under the shadow of Brexit, the Chancellor urged those in attendance at the conference to “to strive and graft and fight to seize opportunities” and to develop the next generation of inventors and innovators.
“If the UK is going to make the most of the freedoms it will have after leaving the European Union we have to build trade links with the fast-growing economies of Asia…we have to invest in the skills of the future…and our economy must remain at the cutting edge: Not just of Fintech. But of AI, biotech – of every area in which we have the potential to lead the world into this new industrial revolution,” said Hammond.
Outlining the support that government has provided and intends to provide, Mr Hammond said: “The government has also played its part. In the last year we have introduced a new investors’ relief to support investment into firms looking to scale up provided £400 million of new capital to the British Business Bank to leverage £1bn of investment in UK technology businesses and through our proposal for the Royal Bank of Scotland, we will see funding for a series of initiatives, worth around £750 million, to boost competition in the UK business banking market, and to stimulate further investment in FinTech of the future.
This confirmation of support from the Chancellor comes at a key moment with Brexit having been given the go ahead, as fintech in the UK is innovative, extensive and formidable, but may face a sizeable challenge as the Brexit process is carried out.
The initial stages of take-off for fintechs can be full of fragility and risks, but the sector is drawing in massive investment and stoking up a great deal of confidence. The recent launch of ClearBank, the first new clearing bank in the UK in 250 years is another promising arrival for fintech, as the bank has a specific motive to also provide a platform for new fintechs to draw upon to gain traction in the competitive sector.
The support expressed on behalf of the UK government by the Chancellor of the Exchequer matches sentiments expressed by Governor of the Bank of England, Mark Carney, who earlier this year shared his thoughts on the significant and exciting impact of fintech on the world.
Ruth Milligan head of financial services and payments at techUK said: “The UK is well ahead of the game on FinTech. Jurisdictions world-wide are copying the regulatory sandbox models, following the development of open banking and looking to recreate what the UK has initiated. It is essential that Government and regulators keep up the good work in promoting the sustainability and growth in this crucial area of the economy. Access to finance, free movement of a skilled workforce and continued seamless links within Europe will also be key to keeping the UK at the top of the FinTech tree.”