This past weekend was the UCAS deadline to apply for university. Graduating in three years these prospective students could play a key role in the success of UK fintech as part of the post-Brexit talent pool.
In recent years, London has shaken off the dust of the global financial crisis to become the world-leading centre for fintech companies. The cluster, which today includes leading players in online lending, payment technologies, crowdfunding and cryptocurrencies has thrived, turning over some £6.6bn and attracting £524m in investment in 2015, according the accountancy giant EY.
After May’s speech this afternoon the intention of a separation from the European Union is clear. But how can the factors that drove London’s fintech boom be sustained? Financial and regulatory support has been put in place but access to talent – equally important for continued success – has been less talked about.
It is clear that the UK government is trying to be responsive to the needs of fintechs. Since 23 June May’s government has moved ahead with several initiatives to ensure that London’s accomplishments in the area can be sustained after the separation from the EU. These have included £400m of venture capital funds that Chancellor Philip Hammond said would be pumped through the Business Bank to support fast-growth companies, “unlocking £1bn of new finance for growing firms” and City minister Simon Kirby appointing two “Fintech Envoys” for Scotland.
The Financial Conduct Authority has also been doing its bit. A couple of years ago the regulator introduced a more streamlined process of licence approval for new fintech products and services, and continues to finesse its “regulatory sandbox” which gives fintech firms a safe space to test new products, services, business models and delivery mechanisms.
These initiatives are incredibly valuable to protect the current thriving state of the fintech industry. However access to talent needs to rise up the industry agenda alongside capital and regulation.
From a long-term perspective, thought needs to go into widening the pipeline of UK talent to ensure that if needed, universities are capable of delivering sufficient numbers of appropriately skilled graduates. Programming and analytics, so-called STEM qualifications are at the centre of our industry but supporting roles are also important, which is why businesses should be looking to promote a general interest in fintech among students. At a post-graduate level Strathclyde University has already risen to the challenge and will be launching the UK’s first Fintech MSc in September 2017 – it would be great if other universities follow suit.
Industry-academia partnerships are another source that can contribute to building skills and attracting talent. In Asia the Hong Kong Monetary Authority and Technology Research Institute have rolled out a programme that provides fintech internships for undergraduate and postgraduate students. The initiative is the brainchild of eleven banks and nine universities who have come together to offer seventy six-month to one year long internships. The hope it that it will help boost the quickly growing local fintech scene.
Why does it matter?
The coming years will be a critical test for the UK fintech community. Government, industry and academia will need to come together to protect one of the UK’s biggest post-financial crisis achievements. Building a strong future talent pool is only one part of the puzzle, but university courses, internships and greater awareness of career opportunities are all steps in the right direction.