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Fintech Q4 2023

Why fintech has the potential to future-proof the finance industry

Technical financial graph on technology abstract background
Technical financial graph on technology abstract background
iStock / Getty Images Plus / monsitj

Janine Hirt

CEO, Innovate Finance  

UK fintech has an impressive track record in addressing financial challenges — from the 2008 financial crisis to the Covid-19 pandemic prompting the move to digital and online, and now in supporting individuals and SMEs through the cost of living crisis.

Our recent Innovate Finance ‘FinTech Impact Report,’ produced in collaboration with Accenture, shows that 98% of fintechs in the UK are having a positive impact on the United Nations’ sustainable development goals. More than a quarter are directly addressing inequality, and more than a third are contributing towards peace, justice and strong institutions.

Cutting-edge digital payments infrastructure

The ongoing positive impact of UK fintech on not only financial services but wider society is clear. Yet, slow progress around developing smart, effective and timely regulation risks holding the sector back from its full potential.

Our digital payments infrastructure is a prime example of the opportunity available to the UK to be at the forefront of cutting-edge technology that is transforming financial services for the better. Consumers and businesses in the UK made 17 billion contactless payments in 2022. Fintech and financial innovation have fostered streamlined, cost-effective and near-instantaneous payment solutions.

UK Fintech attracted over $12.5 billion
of investment funding in 2022.

More secure and convenient payment platforms

The growing adoption of digital wallets, peer-to-peer payment apps and blockchain-based platforms are just a few examples of such transformation. These innovations make payments more efficient, secure and accessible; reduce friction in financial transactions; simplify the lives of consumers; and offer businesses enhanced options for managing their finances. It is now critical that we further progress with a comprehensive and cohesive strategy for payments.

UK Fintech attracted over $12.5 billion of investment funding in 2022. With an estimated 46% growth year-on-year by number of employees, UK fintechs are a driving force for the country’s economy. It is critical that consumers remain financially included, with access to intuitive tools for budgeting, savings and investing.

What we need to build an inclusive financial future

We must not underestimate the positive impact of the UK fintech sector on our daily lives. By embracing technology, fostering a regulatory framework that both protects the consumer and allows them to benefit from innovation and supporting this thriving sector of our economy, we have the potential not only to navigate today’s financial challenges but to build a more resilient and inclusive financial future for all.

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