A recent report by the All-Parliamentary Group (APPG) has reiterated confidence in the U.K.'s entrepreneurship and innovation in the long term despite Britain's recent vote to exit from the European Union.
After the Brexit referendum, there were concerns that the exit would reduce access to markets, talent, passporting powers and funding for U.K. SMEs. The fear was compounded by moves by other European cities to present their readiness to accept Fintech startups to leave the U.K.
Paris Europlace, which promotes French finance plans, chose to travel to London to entice financial firms and professionals. Also, the French government agency, Business France, also distributed leaflets to promote the benefits of working and living in Paris.
In Germany, Frankfurt city officials set up a specialist hotline for banks that want to discuss moving operations outside of the U.K.
Several British businesses also declared their readiness to relocate to mainland Europe, just as the U.K. lost its coveted AAA credit rating within 24 hours of the vote.
However, in APPG's report ‘Stepping Forward for Fintech’, the group developed some issues on how technology can improve interaction with financial products, enter the digital market and avoid costs and difficulties faced by bricks-and-mortar providers.
It says the U.K. has one of the world’s most supportive and progressive regulatory and policy environments, a well-qualified and experienced talent pool, and tax breaks for digital and technology start-ups.
The report says:
It can drive the creation of new markets, such as crowdfunding, and the opening up of existing markets to a new audience, such as robo-advice. It can help those who need finance to access it more quickly and efficiently. And it can help keep us secure against the risk of fraud and money laundering.
It added that U.K. is a “tech nation” with hotspots all over the U.K. with their own specialisms and
expertise, each competing globally in those markets.
APPG was set up to raise awareness in parliament of the growing importance of fintech to the U.K. economy, to policy-making and to consumers. It aims to promote a regulatory framework that encourages a growing, inclusive and competitive fintech industry. It also seeks to investigate the potential applications of fintech including peer-to-peer lending, crowdfunding, digital currencies, and internet banking etc.
The group believes that though the U.K. is a world leader for fintech, its position is not guaranteed in a climate of robust global competition.
Further work will be necessary to ensure that the U.K. keeps the momentum that it has been building. This period of fast and encouraging growth is an opportune time to consider how we bring the best out of the potential that FinTech offers for us, our communities and our businesses.
It cites a report by Citi which says that unlike China, the U.K. has yet to reach the "tipping point" of digital disruption. The group also encouraged those in government, policymakers, and the industry to embrace and understand the reality of fast-paced technological change to the financial services landscape.
It says: "Together we can help ensure that the U.K. continues to flourish as a financial centre, and help direct future developments towards the greatest benefits for all stakeholders in our society."
Featured image from Shutterstock.