At Budget 2020, the Chancellor asked Ron Kalifa OBE to conduct an independent review to identify priority areas to support the UK’s fintech sector. The Review formally launched in July 2020 with objectives for supporting the growth and widespread adoption of UK fintech, and for maintaining the UK’s global fintech reputation.
rebuildingsociety.com's Managing Director Daniel Rajkumar shares his thoughts on the report:
"This review has the potential to give the UK fintech industry a much-needed stimulus, which is vital if the UK is to remain the darling of fintech post-Brexit. From the contents, I was intrigued by the 'Scalebox', the 'Fintech Growth Fund' and the 'growth of fintech clusters'. The report hits on pertinent matters, frequently discussed among colleagues at Fintech North events. Could this be the ticket to help us scale? Let’s hope so…
The Executive Summary helps set the scene by recognising the prizes: Jobs, Trade, Inclusion and Recovery. It also elaborates on five key areas: Policy & Regulation, Skills, Investment, International and National connectivity. Importantly, the report calls for action, but how easy is it to act on?
The review does not read as though it were written by someone who has been through the fintech startup/scaleup journey, but that’s forgivable for its depth. I was a bit surprised the report didn’t reference surveys, direct research or stats about what fintechs have said they want. The smattering of case studies is good for the profile a few firms, but the questions are disconnected from the point of the report. For example, the format follows a template: What problems is your company solving? How many jobs have you created? Do you have plans to expand? Give us one or two examples of how your firm has made life easier for a specific customer. These questions miss an opportunity to reach and influence key policy makers. Better questions would have been: What is holding you back from scaling? If you had £1m investment, how would you use it to drive growth? What could the regulator do to better support your industry? How do you overcome the skills shortage?
I also liked the recommendations to regulate crypto assets, reduce the cost of an IPO and the recommendation for government and regulators to improve technical expertise through upskilling.
Recommendation 2 was my favourite: Implement a 'scalebox' that supports the growth of firms focussing on innovative technology, although it is unclear if the FCA was consulted about this recommendation, as it reads like a brainstorm of ideas turned into pros. The FCA's comment and contribution are certainly missed. The ideas are good, but need sanitation from the authorities that would be expected to implement them.
I also loved the visa stream recommendation, although who wants to come to a country that doesn’t welcome immigrants? As a company, we had a plan to bring in overseas talent from people who have now asked if they can remain remote workers. In fact, only a few weeks back we hired a HR Manager who is not UK-based. You see, now that we’re all remote workers our ‘talent pool’ is a ‘global talent ocean’.
The national connectivity piece reads like an afterthought. 'The Pennines' is apparently a fintech cluster; presumably this was an attempt to not offend either Leeds or Manchester? What is wrong with the Northern Powerhouse brand? Again, no comment from key stakeholders who actually run the connectivity hubs in the regions. I noticed that Fintech Wales and Fintech Scotland had Case Studies included. Oh wait, I remember, they are devolved regions with separate governments. Maybe that is what we need..."
