The Britain’s desire to remain one of the financial hubs of the world has recently received the impetus, when the Chancellor Philip Hammond disclosed the Fintech strategy. The strategy is poised to guide, promote and encourage the financial innovation through technology.
With Financial Services Trade and Investment Board to identify the two key areas of mutual cooperation between the government and the industry, such steps ensures the brighter prospects for the Fintech industry in the UK.
In order to facilitate the companies in terms of scale, the chancellor proposed “Fintech Bridge” with Australia. This will ultimately result in the mechanism or platform that is expected to make it easier for the Fintech firms to run their operations in the other country.
This strategy was the outcome that comes from the backdrop of government’s initiative to institute a fintech census in March last year. The main purpose of the initiatives were to identify the challenges emanating from
- Cost and complexity of regulatory compliance
- Problems finding a skilled workforce
- Difficulties of forming partnerships with banks.
However, the plan only facilitated the formation of partnerships with the bank through “fintech delivery panel”. This resulted in the formation of new standard that can be used to ameliorate the mechanisms of partnership between the incumbents and the Fintech firms.
The strategy document also entails the creation of a new taskforce headed by the Treasury, Bank of England and Financial Conduct Authority. This taskforce will be charged to assess the benefits and underlying risks associated with the new technology.
The strategy is hailed as the proof that the British government is serious in having a quantum leap in terms of technology in the financial sector. All this pomp and circumstance on the back of boasting Uk’s image as center for the fastest-growing fintech sector in the world.
In UK, it is pertinent to note that fintech firms has amassed the revenue of £ 6.6 bn in annual turnover by 2015. Another report published that among the 39 fintech firms that hit the valuations of $1 billion, 17 belonged to the UK.