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
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.
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.
Since opening our doors back in 2014, we’ve always prided ourselves on living and breathing two key principles at Lending Works: innovation, and putting the customer first in everything we do.
With the retail sector enduring its fair share of challenges, companies are looking at new ways to attract customers, and drive conversion. In an overcrowded, dog-eat-dog marketplace, with behemoths such as Amazon flexing their muscle, it’s easier said than done.
On 4 June 2019, the Financial Conduct Authority (FCA) released its new regulatory framework for peer-to-peer lending (P2P); a Policy Statement known as PS19/14. As you might imagine, it's a document which, following a three-month consultation, is a hefty read of no fewer than 102 pages.
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.
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 peer-to-peer (P2P) lending industry is now regulated by the Financial Conduct Authority (FCA). The regulatory framework has been designed to protect customers and promote effective competition.
January tends to be a comedown following the Christmas festivities, and, from a personal finance perspective, a time for many Britons to lick their wounds. In particular, for those who’ve over-extended their credit card, it may feel like the walls have started to close in.
A new year, and indeed a new decade has dawned. Reflecting on 2019, what seemed to have got lost in the noise and political hysteria was the fact that the UK economy actually held up remarkably well.
As the good times rolled in the mid-2000s, only a precious few sounded the alarm as lending became increasingly reckless. Northern Rock's infamous 'Together' 125 per cent mortgage epitomised the rush for high loan-to-value (LTV) deals at a time when it was thought that house prices would just keep going up forever.
For those with an eye on the economy, 'GDP day' is always one to mark off in the calendar each month. And it's been a hot topic for the UK in 2019, with the latest update showing zero growth for the period from August to October.
One of the perceived strengths of the auto-enrolment pension scheme is its simplicity – indeed, it is actually a greater effort for an employee to opt-out of a workplace pension than it is to be enrolled into one. No further actions are required, and the retirement fund grows as the months and years pass by.