By Ben Jackson, CEO at Oxygen Finance
The government’s recognition of the transformational impact our fintech sector can have on both the UK and World economy is to be applauded, but, as the old adage goes, you have to know where you are starting from to know where you are going.
The launch of the strategy placed a disproportionate emphasis on the shiny, headline grabbing topics of cryptocurrency and blockchain. Undoubtedly, they are important, but there are more fundamental challenges, such as payments and procurement, that are real areas of pain that exist today within the finance functions of businesses big and small. Helping the fintech sector to support businesses in solving these problems is where the focus of government strategy must be.
The UK has a world class fintech sector, which must look to the future to grow and develop, but there also needs to be a reality check around the current market conditions in which fintech companies are operating. Many of the largest corporates and public sector organisations they work with are still handling paper and accounting practices are similar to those in the early 1970’s. Existing issues around security and fraud are also major concerns for finance directors and require urgent attention.
Planning for the possibility of the problems we will face tomorrow around Cryptoassets and blockchain solutions, which are still some years from being accepted practice, appears to be a case of putting the cart before the horse.
“Measures outlined in the strategy that support fintech firms to enter a space, previously dominated by the banks, who have frankly had it too good for too long, with competitive products makes obvious sense. Open banking and PSD2 are significant milestones in enabling alternative providers to do this, disrupting the status quo by offering new and more efficient ways of doing business and undertaking basic financial transactions.
“One final note – the UK-wide narrative around the strategy was certainly welcome, although it’s frustrating to see England referenced as London and ‘the North’, rather than the variety of vibrant cities and regions it actually is. As a fintech business, with a need for a skilled digital workforce, we moved our headquarters out of London to Birmingham – the so-called Silicon Canal, thanks to its thriving digital sector and huge post-graduate population – and we have since managed to build a stellar team that can easily go toe to toe with the best tech talent from the capital.
