In recent years the number of new start-up companies in Scotland has exploded at an exponential rate. With business incubators such as CodeBase, specifically for technology firms, we are now seeing the rise of a sector that did not exist ten years ago.
In the financial services sector, some of this technology has had the biggest impact. An amalgamation which, on the surface, one wouldn’t expect to work, but it actually does incredibly well.
It combines the merging of a traditional, regulatory-led industry such as banking and combines it with the fresh ideas, tech know-how and passion of young technology companies. The result is “fintech” and it’s great to see that Edinburgh, with London, has been blazing a trail for this new arena.
As technology continues to advance, fintech will only become bigger and more important to the financial services sector. Earlier this year EY reported the sector was now worth £6.6 billion to the UK and employs over 60,000 people.
Fintech has its roots in several areas, but perhaps the most important is customer demand. In 2016 we no longer expect to have to walk into a bank, or even phone a call centre to make a transaction or to view our bank balance. We expect to be able to do this at the touch of a button, on our mobiles, regardless of whether we are sitting on a bus, are out and about, or sitting on the sofa at home.
Other factors that have given rise to fintech include the lingering effects of the 2008 recession, the rise of big data and the increasing sophistication of marketing.
Edinburgh is now home to several of the most successful fintech companies including Money Dashboard and RollRun, with more coming to the scene in 2015 and continuing to do so throughout 2016. What has made the capital so desirable for tech start-ups in this space is the unstoppable talent pool of graduates coming from Edinburgh’s four universities.
Edinburgh University in particular has one of the leading IT schools in the UK, and individuals graduating from there will have some fantastic opportunities available to them. A continuing pipeline of fresh ideas and talent can only help the banking sector innovate and create new and improved ways for consumers to use their services.
What’s more, since Edinburgh has become the second-largest financial services sector in the UK after London, it only makes sense for these young and upcoming businesses to be based close by in order to work hand-in-hand with the sector.
With an established start-up mentality, a strong support structure and the right infrastructure in place to support business growth across the sector board, Edinburgh is the ideal breeding ground and for fintech to make its mark.
What we are seeing is the rise of a new and exciting sector that merges traditional services with new technology and new ideas, and Edinburgh is the place to be if you want to get involved. As one of the most desirable cities to live and work in, and with a raft of financial services firms already based here, it comes as no surprise that young, savvy tech firms are making Edinburgh their stomping ground also.
• Mark McFall is managing director of Change Recruitment Group