This is the one special ingredient crucial to the UK's fintech success

Lawrence Wintermeyer
Spring Cleaning Takes Place At English Heritage Properties Around The UK
The UK's fintech success is down to a special recipe (Source: Getty)

Fintech is booming and London is at the heart of this global community. The Innovate Finance Global Summit at London’s Guildhall today has attracted over 1,200 business leaders, politicians, and pundits from around the world to discuss the big trends in fintech. Here is our perspective on why it’s booming – and why so many people have joined come to the square mile today.

With trillions of dollars in payments, bonds, stocks, capital and lending markets there are big opportunities available to innovators to disrupt traditional financial services with new and improved solutions. In addition, the estimated two billion “unbanked” people in the world that are outside of the current financial system are proving an attractive market to many players offering new technologies designed to transform economic fortunes.

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The three essential ingredients in any successful fintech recipe are talent, technology and investment. These things are being combined in varying proportions in each of the major global fintech hubs like the Valley, New York, and London to produce many outstanding fintechs that are delivering new solutions that are driving the boom. What sets the UK apart from other fintech hubs, however, is the progressive policy and regulatory environment, which is further confirmed in the recent findings of a HM Treasury EY Report on global fintech hubs.

TALENT in coding, engineering, maths and design in financial services apps is in abundance with over 60,000 people employed in fintech in London. The UK promotes diversity and we have a higher percentage of women leaders in our fintech membership than can be found across European technology firms and public companies. With London’s recent rating as the number one financial services hub on the planet, and with over 250 languages spoken in London, we have the most diverse cultural landscape in the world to develop new solutions.

TECHNOLOGY, and apps are changing the way we do things from booking travel, to buying goods and services and managing our personal health. The opportunity to offer customers better financial solutions is ripe. With an estimated two billion people using smart phones set to increase to 6 billion by 2020, this trend will continue to drive the mass adoption of new financial services applications. This is especially the case where charges and fees are reduced, and customers are further incentivised to engage with solutions because they are easy to understand and use, and offer greater value.

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INVESTMENT in global fintech was over $12bn in 2015 and the UK was second to the US with almost $1 billion of venture capital raised. Financial institutions have also started paying attention to innovators with corporate venture capital funds and many major financial institutions investing millions in fintechs, incubators, accelerators, labs, partnerships, talent and new technologies such as the blockchain. FinTech is not just about startups, it increasingly includes the innovators and disrupters within global institutions focused on capital efficiency, especially as it relates to the reduction of the expense of legacy IT systems and infrastructure.

POLICY and REGULATION in fintech is being driven by a digitally astute and proactive UK government and supported by the Bank of England, City of London, and the regulators. The leadership of the FCA with Project Innovate, Regulatory and industry sandboxes, and regtech (regulation technology) is truly innovative and is further accelerating

open competition. The UK’s Open Banking API is now aligned to Europe’s Payment Services Directive and the current focus is now on implementing the Financial Advice Market Review findings. The UK’s policy and regulatory environment really is the envy of the world’s finTech hubs. It is a privilege for Innovate Finance to welcome 250 members, 80 speakers, 20 sponsors, eight global hubs and 1000 guests from all around the world to the 2016 Innovate Finance Global Summit. With the further support of our conference collaborators, The Gates Foundation, the World Economic Forum, and Unicef, I am sure it will prove to be a landmark event and leave everyone that attends with no doubt that London is the premier global hub for fintech.

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