The 2008 global financial crisis marked a watershed moment for the financial services sector.
For the global economy to recover, it needed to innovate. Investment in technology and its application across the entire financial system — what we now refer to as “fintech” — has since transformed the industry as we know it.
Fintech will once again play a critical role as we move along the path towards economic recovery after this pandemic. Global lockdowns have accelerated the digitisation of finance, and it will require agility and versatility from startups and investors alike to meet the opportunities and challenges this will continue to bring.
Such pragmatism is already why London and the UK saw record amounts of investment in fintech in 2019, and that philosophy will be more important than ever as we emerge from the shadow cast by the global recession.
The work is already well underway.
Just last week, as part of our campaign The Global City, which showcases the UK’s offer for financial and professional services, we released a new research-backed brochure for investors in partnership with Innovate Finance. This focuses on four areas within fintech where the UK is already leading the way: regtech, payments, artificial intelligence, and tech for good.
Some UK startups working across these sectors have been receiving unprecedented demand for their services during the pandemic. Those showcased include GoodBox, which experienced a rise in demand from charities looking to accept digital donations in lockdown as cash usage declines at a faster rate than ever before, and identity verification company Onfido, whose technology is of interest to firms looking to set up immunity passports.
Of course, given the upheaval and uncertainty facing businesses and the economy in general, we must not be complacent. Within that brochure, we also highlight how the nurturing environment in the UK, supported by effective policy and regulation, continues to build and scale an ever more diverse variety of firms.
It will be vital that we continue to work innovatively with stakeholders across the sector to provide a means for startups to test and validate their solutions, as well as provide support on common regulatory challenges and how these can be addressed.
Furthermore, it is imperative that investors continue enabling innovators to keep doing what they do best. Secure investment will be vital at early stages of the fintech journey, while a healthy pipeline of investment will help strengthen innovation and as UK’s financial sector is reshaped.
If we can achieve this, the stage is set for the UK to play a vital role in developing innovative fintech products and services that are not just easier to use, but also open to more people worldwide.
The prize, as we leave the pandemic behind, will be a quicker global economic recovery through the democratisation of financial services, and increased prosperity for many in the years to come.
Main image credit: Getty