WHEN a teacher commits a crime, people don’t question the legitimacy of education. And when a doctor breaks the law – and the Hippocratic oath – people don’t suggest that there is something inherently corrupting about giving people the power to save lives. Yet different standards are applied to finance. Far too many commentators take the specific – most recently, the Libor scandal – and tar the whole industry with the brush of criminals.
Finance is more than Libor traders. Taken as a whole, the industry forms the veins that keep the global economy pumping. Entrepreneurs are reliant on the finance industry to breathe life into their ideas, but they can also disrupt the industry as financial service entrepreneurs.
Finance is a hotbed of entrepreneurial activity. Kickstarter – the crowd funding website for creative projects – has announced it’s coming to the UK. A recent Kickstarter project for a hackable Android-based video gaming device raised over $3m – it passed $1m in just 8 hours and 22 minutes. It’s as though companies are going public on launch. The UK has it’s own innovative lending companies, like Funding Circle, which was set up by Samir Desai, James Meekings and Andrew Mullinger in 2010. It has already lent £38m and is currently lending more than £1m per week.
At the recent European showcase for the Society for Worldwide Interbank Financial Telecommunication, Digital Shadows, a UK company, was named top start-up. Digital Shadows offers a cyber monitoring service that protects organisations from the risks to their security and reputation posed by the information they expose online. It goes on to compete for the global prize in Osaka.
Innocent innovators and workers in financial services are making a huge contribution. Those who tar all of finance with the same brush are making a terrible mistake. Twitter: @Philip_Salter