‘Winning with Fintech’
The Confederation of British Industry (CBI) has called out Fintech as a key opportunity for the UK economy.
In a speech today, CBI President Lord Bilimoria announced a new campaign to encourage more people to utilize Fintech and help boost the future growth of the sector. The campaign’s goal is to help non-financial firms to utilize Fintech as a means of embracing innovation; improving efficiency and competitiveness. CBI believes that Fintech can “unlock productivity growth” at a time when it has never been more important.
The CBI’s economic strategy Seize the Moment has identified the UK’s Fintech sector with a potential £32 billion in additional revenues by 2030. Statistics from Innovate Finance indicate that in 2021 $11.6 billion was invested in UK Fintech businesses, a 217% increase from 2020.
Lord Bilimoria said:
“Businesses need all the support they can get at present. Slow growth post-pandemic and supply chain struggles have been exacerbated by the terrible conflict in Ukraine. What firms need are fair winds and following seas, with Fintech featuring a flotilla of benefits, making global trade smoother, payments easier and sustainability better. The UK’s world-leading Fintech sector is ideally placed to go from strength-to-strength in supporting businesses to manage risks and reduce costs in an uncertain world. The CBI will champion fintech by supporting businesses of all sizes across and sectors to seek solutions that will work for them. The government is to be applauded for acting on last year’s excellent Kalifa review. Beyond this, the CBI sees a continued role for ministers in driving adoption; from greater coordination of Fintech-related initiatives to furnishing the UK’s labour market with the digital skills it needs to succeed. “
He added that by combining CBI’s influence with the City of London it will be a “surefire way to success; helping firms fuel their future growth.”
From Q2 2022 onward, the CBI will be launching “toolkits” for its members designed to help UK businesses learn how they can utilize Fintech in the following areas:
- Global trade: using fintechs to open new markets more easily, improve resilience across supply chains, and reduce the costs and risks of importing and exporting
- Decarbonisation: showcasing how fintechs can help businesses on their net-zero journey, such as mapping carbon footprints, measuring progress against sustainability goals, and meeting regulatory reporting requirements
- Payments innovation: improving payment journeys by pushing financial technology to critical propositions and processes.
Ed Thurman, CBI Strategic Adviser on Fintech, added:
“All too often many businesses think innovation is something other firms do. ‘Winning with Fintech’ aims to get more firms engaged with financial technologies to save costs, improve efficiency and go for growth. In challenging times, partnering to achieve these aims will be crucial for businesses of all sizes, and is a key area of focus for this work.”
The UK has long been recognized as a top global Fintech hub. Over time, certain industry participants have worried that policymakers were not as committed to the important industry. But more recently, the UK government has reinvigorated its support of Fintech. Earlier this month, HM Treasury announced that the UK government will acknowledge stablecoins as a form of valid payment. The government is also expected to create legislation to bring stablecoins within the payments regulatory perimeter, creating conditions for stablecoins issuers and service providers to operate and invest in the UK. The goal is for the UK to become a global hub for digital asset technology and investment.
Tom Pope, Head of Payments & Platforms at Tink – an open banking provider, shared the following comment on CBI’s announcement:
“The latest campaign launch from the Confederation of British Industry (CBI) is testament to the power of Fintech on not just economic growth, but setting businesses apart from the competition. Open banking payments is the latest innovation taking the payments sector by storm, by transforming previously underserved user experiences. Open banking payments, often called Pay By Bank, is a transfer of money from one bank to another. With open banking payments, you don’t need coins, notes, cards, or a good memory for long numbers. All a payment needs is your permission. And the permission is granted directly using the provider the consumer trusts the most – their bank.”
Pope said that by harnessing the power of Fintech, merchants can “eliminate friction” and perform better.