Summary of a post.
The future of UK fintech looks bright
With hostilities surrounding the Brexit negotiations commencing in earnest this week, Europe and the United Kingdom, at least politically, seem to be worlds apart. But against such a backdrop of standoff and uncertainty, there is one industry which continues to thrive: fintech.
In fact, in Q1 2017 fintech investment between the UK and the continent soared to a two-year high, according to research by KPMG. Mainland Europe invested around £165 million in UK fintech SMEs and start-ups, which is the highest since Q3 2015. The UK returned the favour with interest too, ploughing roughly £330 million in venture capital finance into European startups.
It isn’t just exchanges with Europe which make for favourable reading either. In the same quarter, £150 million was invested into UK fintechs by venture capitalists in the US; a figure that dwarfs the total invested throughout 2016.
The release of such findings comes on the back of the second annual UK Fintech Week in London last month, with the inaugural international fintech conference being staged. At this gathering of more than 100 leading UK fintech firms and hundreds of global investors, Chancellor Philip Hammond waxed lyrical about an industry which is worth nearly £7 billion to the UK economy, and has created jobs for over 60,000 people.
“The fintech sector is one of our fastest growing sectors, adding more than £6.6bn into the UK’s economy and attracting more than £500m of investment,” he said in his speech in April. “Fintech provides consumers with better services, more choice, and lower costs for businesses. It can mean access to new and cheaper credit too.”
Complacency is the enemy
However, while proclaiming that the country’s fintech industry will “lead the world” into the fourth industrial revolution – a progression from the so-called digital revolution - Hammond also observed the challenges for the UK in retaining its place at the summit of the global fintech sector.
“We can’t remain the number one place for fintech and the other technologies of the fourth industrial revolution by simply relying on our ingenuity, talent and openness - we have to go out and get the business.
“We will have to strive and graft and fight to seize the opportunities – and make the most of them. That means growing and strengthening the areas – like fintech – in which we enjoy a competitive advantage.”
Investment and the future
Yet attracting such extensive investment is indicative of the important role fintech plays within Britain’s powerhouse financial services sector. And such performance levels are not a product of accident or chance either. Aside from the fact that Britain enjoys a deep-rooted heritage in financial services anyway, it also offers an idyllic ecosystem underpinned by market-leading digital technology, progressive regulation and a fertile investment landscape.
It has also been backed to the hilt by Government, with Hammond adding in a separate interview with The Times: “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.”
As such, there is good reason to believe that, with a continued focus on innovation, technology and skills development, the future for fintech is bright – regardless of what deals (or lack thereof) our politicians are able to carve out. Of course, there will always be external challenges and uncertainties, along with inherent risks associated with the launch phase of fintechs themselves. But with inward investment flying in, confidence on the rise and an increasingly conducive environment for prosperity, fintech looks well placed to flourish, and thus become the engine of growth for UK financial services for many years to come.
Related articles:
Our website offers information about saving, investing, tax and other financial matters, but not personal advice. If you're not sure whether peer-to-peer lending is right for you, please seek independent financial advice, and if you decide to invest with Lending Works, please read our Key Lender Information PDF first.
As with all investments, your capital is at risk.
- Summary of a post.
- Summary of a post.
- Summary of a post.
In line with our risk management framework, today we published our Q4 2019 performance update.
As a platform, we take great pride in all that we've achieved since opening our doors for business nearly six years ago. We’ve
Featured
Wednesday’s Budget speech, coupled with the cut to Bank of England rates, represented a decisive response to the coronavirus. Here we analyse the impact it will have on mitigating disruption from Covid-19, along with the long-term implications of this significant fiscal stimulus.
Rumblings from the Treasury ahead of next week's Budget suggest tax grabs will be needed to fund increased spending, and it appears UK enterprise could be in the firing line. Here we articulate why targeting entrepreneurs and small business is ill advised.
In a difficult climate, customer acquisition and lead generation present stern challenges for UK retailers, and a great deal of marketing spend invariably gets directed towards getting feet through the door.
There is a variety of literature and research illustrating the importance of building brand loyalty, albeit with some degree of variance.
Over the last decade, there can be little dispute that the reputation of mainstream banks – and particularly the so-called ‘Big Four’ (HSBC, Barclays, Lloyds and RBS) – is at its lowest ebb.
The idea of peer-to-peer (P2P) lending is a simple one; you lend money to those who wish to borrow, with a view to receiving a great return for doing so.
Most popular
- Summary of a post.
- Summary of a post.
- Summary of a post.
- Summary of a post.
The 2019-20 ISA season has been a damp squib, with banks disinterested in attracting savers’ cash, rates cut, and the stock market in freefall. However, the emergence of the IFISA means alternatives beckon for those seeking a stable middle ground in terms of risk and reward.
In a decade of slow recovery, the rapid rise in asset prices has been the standout. But how sustainable has price growth been, and could we be in the midst of a bubble?
Recent
The Lending Works Shield does not give you a right to a payment so you may not receive a pay-out even if you suffer loss. The Lending Works Trustee has absolute discretion as to the amount that may be paid, including making no payment at all. Therefore, investors should not rely on possible pay-outs from the Lending Works Shield when considering whether or how much to invest. For more information click here.