Fintech will more ‘profoundly’ affect Britain than Brexit, says MP

By Roger Baird on Monday 18 March 2019

Alternative LendingDigital BankingSavings and Investment

All-party alternative lending chairman Lee Rowley said the fintech industry is at the a ‘vanguard’ of UK lending.

The fintech industry rather than the Brexit crisis will have a greater long-term effect on people’s lives, according to Lee Rowley MP, who opened this year’s AltFi London Summit today.

Rowley, chairman of the all-party parliamentary group on alternative lending, said: “Brexit has been consuming everything for months now, and we haven’t been able to focus on anything else.

“But this industry is at the vanguard of profound change, giving real people access to credit in the real world. And it is also helping to restore trust in financial services, which was shattered in the years following the financial crisis.”

The 38-year-old Conservative MP for North East Derbyshire said in his constituency the fintech industry was doing the “vital work” of allowing people to get loans after their town’s last remaining bank had closed.

Rowley worked for a decade in financial services as a manager for such banks as Santander and Barclays, as well as in insurance for the Co-operative Group before entering the House of Commons in 2017.

However, the MP warned that understanding of fintech within parliament is “woefully low”.

Child's Play

He said: “MPs think fintech is something for young people to play with on their phones. While alternative credit has a less positive reputation.”

Rowley added: “MPs always turn up when things aren’t going well. It is the industry’s job to sure they get involved when things are going well.”

His comments come after chancellor Philip Hammond last week welcomed a report which said that US BigTechs should be forced to drop their “bullying tactics” and get back to the innovation shown by UK fintechs.

A six-month review of the technology sector concluded tech giants such as Facebook and Google should face greater competition.   

The report, commissioned by the government, was led by Harvard professor Jason Furman, who was US President Barack Obama's economic advisor.

UK as fintech hub

The 150-page review, called Unlocking Digital Competition, points to the UK’s fintech industry, led by firms such as Monzo and Funding Circle, as a competitive market that boosts consumer choice. This contrasts with BigTech giants, such as Amazon and Google, have faced calls for tough new legislation for pushing out rivals, paying low rates of tax and selling consumer data to third parties without their customer’s knowledge.

The report said: “The UK is a great place to start a fintech company in part because of Open Banking, and the approach of the Financial Conduct Authority and the Payment Systems Regulator. Applying similar regulatory principles can improve the economic environment in the UK for digital start-ups and scale-ups while creating more predictability for large incumbent firms.”

Chancellor Philip Hammond welcomed Furham’s report in last week’s Spring Statement, adding that Britain “will be a place where successful global tech giants pay their fair share, where competition policy works in consumers’ interests, and where the public are protected from online harms.”

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