Fintech can drive economic recovery and accelerate financial inclusion, says new study

Fintech can be a driving force for the UK’s economic recovery, an independent review has concluded.

Scotland has seen strong growth in its financial technology sector in recent years. Picture: AP Photo/Marcio Jose Sanchez

The study into the financial technology sector, commissioned by the UK Treasury, has highlighted the important role of fintech in creating jobs, developing global trade and enabling financial inclusion.

FinTech Scotland, along with sister organisations across the UK, contributed to the Fintech Strategic Review recommendations which set out a five-point plan to leverage innovation.

The detailed analysis of fintech innovation across the UK gave recognition to the momentum of the FinTech Scotland cluster, which included growing expertise in open finance, payments, regulatory innovation and “fintech for good”.

The Fintech Scotland cluster model was noted as a driving force since its formation in 2018. Progress over the past three years has included increasing the number of fintech SME (small and medium-sized enterprise) firms from 26 to 155 and attracting 27 strategic partners from the private, public and academic sectors.

Stephen Ingledew, executive chair of Fintech Scotland and a member of the Fintech Strategic Review working group, said: “Fintech has the potential to revolutionise how we live whether it’s paying for our shopping or managing our money or setting up a business.

“Crucially, it can play a pivotal role in stopping the exacerbation of economic and social inequalities. Fintech innovation is fast growing right across the UK and offers great potential for Scotland through investment, innovation and jobs.

“We have been fully involved in the review to share our learnings from the last three years, in which we’ve managed to build an inclusive and vibrant cluster, a model which the review recognises can help foster innovation and collaboration in boosting recovery of the UK economy.”

He added: “We believe the review recommendations will support further progress in developing a growing fintech ecosystem and build on successes of home grown and international fintech firms already rooted in Scotland.”

Linda Hanna, interim chief executive of Scottish Enterprise, added: “This independent review supports Scotland’s growing worldwide reputation as a leading fintech location.

“Scottish Enterprise has been proud to partner with FinTech Scotland in developing a vibrant environment that continues to attract international fintech firms from around the world, providing economic opportunities for our communities and high-quality jobs for our skilled workforce.”

Ammar Akhtar, chief executive of banking platform fintech Yobota, said: “This review is essential to the UK retaining its position as a global fintech leader.

“International connectedness has been recognised as a key long-term driver of this, and while the UK’s fintech sector is the emblem of progress, it cannot flourish without a deep pool of global talent.

“A diverse talent pool is an often overlooked driving force of fintech innovation. I believe it is as important as the other key enablers of industry growth, such as strong capital investment and supporting infrastructure.

“Navigating a complex and costly visa system risks deterring potential talent, and we must make it easier for companies to establish and nurture an ambitious and dynamic workforce. This is just as crucial for established companies as it is for start-ups: indeed, talent breeds talent, with existing workers acting as ambassadors to share their passion for innovation.”

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