In a year filled with uncertainty, the rapid growth of the fintech space has been a constant. While fintech companies disrupt, traditional banks struggle to keep up with innovations to remain competitive. While fintech companies are increasingly dominating the market, they can still benefit from the wealth of expertise that traditional institutions have to offer, and the U.K. recently announced an interesting solution to this dichotomy.
In a world first initiative, Tech Nation announced The Fintech Pledge, an initiative developed by the Fintech Delivery Panel with support from HM Treasury (HMT). The goal of this pledge is to support the acceleration of the U.K.’s fintech sector by cultivating and elevating collaboration between traditional banks and leading fintech firms. Ultimately, the pledge stands to pave the way for the U.K. to enhance its stance as a formidable opponent in the competitive worldwide fintech space. This pledge comes after the U.K. government released an independent review of the fintech sector, looking at ways to improve its competitiveness so that the U.K. can run ahead of the international fintech market.
The pledge clearly details five key concepts focused on improving the traditional banking sector’s collaborative relationship and cooperation with fintechs. These include: offering clear guidance to innovation companies on how the onboarding process resolves a dedicated online landing page; offering clarity to tech start-ups on their development through the onboarding process; providing a named contact, guidance, and feedback; encouraging great practice and improvement; and dedication to implementing this process six months from signing the promise and offering bi-annual feedback in the first year.
Speaking on this historic initiative, Victoria Roberts, Director of Fintech Delivery Panel at Tech Nation said, “Building partnerships with established institutions is a fantastic route for fintechs to drive positive change in finance, be it underpinning new customer solutions or transforming regulatory reporting.” John Glen, Economic Secretary to the Treasury further stated, “The U.K. is already the best place in the world to start and grow a Fintech, and we’re committed to that remaining the case as our economy bounces back.”
With the sector reportedly worth around £7 billion to the U.K. economy, it appears that this is a wise move in the right direction for country steering its way to further growth in this market.