With the rise of digital, information networks, robotics, and the smartphone, the pace of technological change is accelerating. This has coincided with increasing populism, creating political and market volatility that some analysts are forecasting as the new normal.
Across the political, business and academic landscape, leaders must be more in tune with their communities, and must deliver tangible benefits that better reflect the voice of the people. This is at the heart of “responsive leadership”, the theme of this year’s Davos.
UK fintech will be well represented at Davos, with the Innovate Finance Infosys Fintech Nightcap today convening over 200 delegates to discuss this year’s theme. There will be much to talk about. In fact, if Davos attendees wish to see responsive, collaborative leadership in action, they need look no further than the success of Britain’s fintech sector.
The UK is a major global fintech hub for many reasons – and the responsive leadership of all its constituent parts is one of them. Fintech is transforming the way people, consumers and businesses access and use financial services in a sector that contributes over £6bn in revenue and employs more than 60,000 people in the UK.
Transferring money abroad or changing currency for travel can be done immediately for no or low fees. Loans can be taken out and new businesses can be funded on a range of lending and crowdfunding platforms at competitive rates. Bank accounts can be set up with new digital challenger banks offering a range of improved products and services for great value. And you can do all of this on your mobile phone.
Our institutional banking members’ response to this challenge has been to lead the innovation charge by creating labs, accelerators, talent scouting programmes, and investment vehicles to collaborate with fintech firms and drive new technologies to transform their propositions for customers. The Open Banking Working Group is seeking to deliver an open API that will revolutionise the UK’s payment infrastructure.
Our professional services and technology members are leading the way with industry research, surveys and points of view across investment, regulation, blockchain, digital identity, capital markets, diversity and payments. Many also provide pro-bono guidance, access to networks, talent and tools, a hugely valued service to startups who otherwise would not be able to afford these things.
The UK government’s policy leadership through the Competition Mandate is opening up the market and bringing greater consumer choice. The support for fintech from Number 10 and 11 is hugely valued, and its impact should not be underestimated.
The Treasury convenes regular roundtables to listen to the community and deliver projects to take action, such as establishing the Innovative Finance Isa and the Fintech Census. It recently adopted a number of our recommendations in the Autumn Statement to improve investment.
Local governments have supported the establishment of fintech hubs in Manchester, Leeds and Edinburgh. The mayor of London has even appointed a successful fintech entrepreneur as his deputy mayor! The City of London’s leadership in fintech is nothing short of visionary.
The FCA has earned the title of the most innovative regulator in the world. Its responsive regulation has delivered Project Innovate and the Regulatory Sandbox, models that have been copied by regulators all around the world. The open and collaborative approach taken by the FCA is designed to both promote competition and better identify consumer and systemic risks early to reduce future problems like excessive charging and mis-selling.
The Bank of England has led on digital currencies, treating them as currencies rather than taxable products or services. It has also launched an accelerator to work directly with fintech firms developing blockchain and distributed ledger technologies. The Bank’s focus on understanding how technology can transform the central banking system for the greater benefit of society is commendable.
Fintech will no doubt continue to grow, changing the face of UK financial services and improving the lives of its citizens and businesses. This is in part thanks to the continued responsive leadership of the UK fintech ecosystem, and the unprecedented level of open collaboration it promotes.