Innovate Finance, a UK financial technology membership association launched by Chancellor George Osborne, today revealed a new manifesto dubbed “UK FinTech 2020.”
The manifesto sets out ambitious goals for the UK to be the premier global hub for financial services technology and innovation. It calls on the government to continue its support for the sector and to back initiatives that will attract global investment, global leading companies, and future fintech jobs to the UK.
According to Innovate Finance, its “UK FinTech 2020” includes the following:
- Investment – For the UK to become the most investment-friendly environment for FinTech globally, attracting $4 billion of venture investment and $4 billion of institutional investment in corporate venture funds, accelerators and innovation programmes. This is up from a UK total of $623 million in 2014.
- Global FinTech Leader – For the UK to become the premier location for at least 25 global FinTech leaders, whether by IPO, global market share or by valuation. The success of this target will be supported by proportionate and effective regulation, a proactive policy environment and a commitment to greater financial inclusion.
- Jobs – For the UK to increase investment in FinTech and develop more global leading companies that will generate 100,000 more jobs in UK FinTech. This will be supported by new FinTech apprenticeships and degree courses that will create the skilled workforce necessary to make the UK the global centre for FinTech.
Commenting on the goals of the manifesto, UK Prime Minister David Cameron stated:
This government wants the UK to be the leading FinTech centre in the world, that’s why, at the Summer Budget, we appointed a Special Envoy for this fast growing sector. I’m pleased that Innovate Finance’s manifesto has set such ambitious goals including the creation of 100,000 jobs. This will ensure we are a world leader in the development of financial services technologies.
The UK’s opportunity to lead fintech already generates £20 billion of GDP for the UK economy and directly employs 135,000 people. Goldman Sachs predicts that a further $4.7 trillion in revenue for traditional financial services is at risk of being displaced globally by new technology-focused entrants. The UK is leading the way in Europe for fintech investment, taking 42% of all European FinTech investment in 2014. Investment grew 136% in 2014, from $264 million in 2013 to $623 million in 2014.
Despite this, Silicon Valley still dominates, with fintech investment at over $2 billion versus a European total of $1.48 billion.
Alastair Lukies CBE, Chairman of Innovate Finance, said:
Utilising the increasingly global reach of technology, financial services are now becoming truly available to all consumers in all economies around the world. The UK has a critical role to play in ensuring financial inclusion, common standards, continued innovation and socially enhancing services for all. Today’s manifesto for 2020 states the UK’s intentions to be a global leader in FinTech, underpinning the important progress of this borderless market for generations to come.
The UK government’s trade mission to Southeast Asia this week is highlighting the importance of both fintech to the country and the global economy. Cameron’s delegation is travelling with many UK business leaders including those representing fintech firms such as Al Lukies, Innovate Finance member firms Ratesetter and iwoca, as well as Bitcoin group Blockchain CEO Peter Smith.
Although cryptocurrency companies like Bitreserve, Coin Sciences, Coinfloor, Coinsilium, Cubits, Gocoin, and SpectroCoin are members of Innovate Finance, it is unclear how the association and its manifesto will benefit the blockchain technology and cryptocurrency sector.
The UK Government has in recent months given off mixed messages on cryptographic technology.
In a February 2015 discussion paper,the Bank of England considered the prospect of central banks using the blockchain technology to issue national digital currencies.
However, Cameron’s recent effort to promote the “Snooper’s Charter” legislation banning high level encryption is considered by some observers and businesses in the blockchain tech ecosystem to be a threat to their operations.