Investment in FinTech up 30%: Lessons from FinTech Week

Gary-Wills,-Crimson,-How-will-technology-affect-the-financial-services-sector-in-2018
Gary Wills
by Gary Wills 20 July 2018

As I’m an IT recruiter that specialises in supporting financial technology companies, I was pleased to attend FinTech Week in London between 6-13 July 2018.

I wanted to use this occasion to learn from fantastic experts from the FinTech sector and to sharpen my knowledge for the benefit of my clients. I learnt a lot, so I thought it would be a good idea to share what I discovered.

As expected, global investment in FinTech companies is up by 30% on last year. It has increased by $37bn and there is no sign of it slowing. Most of the total $145bn investment has been in loans and payments organisations.

Also, 2018 has so far been the year of the UK digital challenger banks. The likes of Revolut, Monzo, Tandem, Atom, Starling, Habito, Trussle, Metro Bank, and ClearScore are all likely to be successful this year for many different reasons.

However, there are a few frustrations among some FinTech start-ups, based on some of the conversations I’ve had. They believe that the amount of Financial Conduct Authority (FCA) regulations are slowing down the good work that has been created. Its being argued that the financial sector could be at a far more advanced stage if the regulators better understood FinTech organisations and their products.

I saw Luis Carranza, Founder of FinTech Worldwide, discuss how the future of owning and sharing data is about to change. He is developing an app which will allow customers to opt-in to sharing their data and receive a form of value in return. The 'value' is yet to be confirmed as the FCA won’t currently allow £ Sterling. However, vouchers and crypto currency are being touted as the most likely options. The premise of the idea is that any data you have can be sold to third parties, including the content on your smart tv, the information from your fitness watch, your social media check-ins, and even information gained from car navigation technology.

In terms of IT jobs in the FinTech sector, I’m seeing several off-shoot industries developing from FinTech, including; InsureTech, GovTech, RegTech, and BigTech. I believe this will lead to the emergence of increasingly specialist IT roles and the emergence of more sector-orientated IT recruitment agencies.

When it comes to FinTech regulatory bodies, Open Banking was one of the first to form. Following them soon will be ‘Open Asset Management’. This organisation will be designed to put consumers in control of their data, providing an easier way to move, manage, and make more of their investments. Open Pensions could also emerge, and Open Wealth is also being considered because many consumers have several pension pots, ISA savings, properties, and shares.

Digital ID is being considered as an option for UK consumers. This will allow consumers to digitally engage with financial services organisations more quickly and easily. It will also create more effective asset management and increase range of new FinTech services. The main benefit will be that it enhances the UKs position in growing global digital financial services markets because there will be one single ID that can be used across borders. The ID can be used for both public and commercial services and will reduce the risk of fraud through the removal of paper-based records.

Big corporate companies, that don’t work in financial services, are also paying close attention to developments in FinTech. In particular, I’ve seen some interesting information on this topic from Pinsent Masons.

Please let me know if you would like to discuss any developments in the FinTech sector, or if you would like to attend one of our FinTech networking events.

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Crimson is an IT consultancy, an IT solutions provider, an IT recruitment agency, and a Microsoft Gold Partner operating across the UK.

Topics: FinTech