The measure is recommended in the Government-commissioned independent Kalifa Fintech Report published today.
The Government asked tech expert Ron Kalifa to look at ways to make the UK one of the best places in the world to launch and run a fintech (financial technology) firm.
Recommendations in the Kalifa Report include:
• Creating a £1 billion-pound fintech ‘growth fund’ to help firms grow independently
•Introducing a new ‘fintech scale up’ visa route for specialists from around the world
•Implementing a ‘scale box’ to provide regulatory support for growing firms
•Establishing a private sector-led Centre for Finance, Innovation and Technology
The UK has more than 10% of the global market share in fintech, according to the report, and the sector is now worth more than £11 billion a year to the UK economy.
The independent review, led by Ron Kalifa, found the UK at a “pivotal moment” in fintech development with opportunities to build on its existing “attractiveness to start-ups firms and become the best place for a fintech business to reach global scale.”
Rishi Sunak, Chancellor of the Exchequer, said: “Fintech is one of the UK’s great success stories and will help us seize new opportunities around the world.
“We must now build on our global reputation for fostering innovative start-ups and ensure firms can access the talent, finance and support they need to scale up here in the UK.
This review will make an important contribution to our plan to retain the UK’s fintech crown, create more skilled jobs, and deliver better financial services for people and businesses.”
Mr Kalifa said: “Fintech has the power to change lives, both in terms of job creation and better wages that are so essential to our recovery; and making financial services more accessible and relevant to people’s lives.
“Britain has a proud record of starting-up and scaling-up some of the best known fintech products, but we cannot rest on our laurels. The next powerhouses will not be created by accident.”
Reaction to the report has mainly been positive but there have been calls for action rather than words.
Stephen Page, CEO of fintech investor SFC Capital, said on the £1bn Fintech Growth Fund: “Especially in the challenging aftermath of Covid when private investors will understandably double down to protect existing investments, it’s all the more important to support companies at the earliest stage to preserve the innovation pipeline.
“We need long-term thinking, not short-term support for perceived quick wins. I hope to see the £1bn Fintech Growth fund proposed in the Kalifa report supporting the truly early-stage startups. We don’t need another Future Fund for companies that have already secured venture capital funding, which excluded the 99% of “true” startups that are still pre-VC.”
• The Kalifa Report can be accessed here