A new report from the UK government's chief scientific adviser has set out 10 recommendations designed to help achieve Chancellor George Osborne's stated aim of turning Britain into the world's fintech capital.
Last summer Osborne vowed to use the government's powers to help make Britain a hub for financial technology innovation and commissioned a report to investigate the enblers and barriers that will shape the fintech sector over the next 10 years.
The report has now been published, recommending the creation of a 'fintech advisory group' with representation from government, regulators, trade associations, academia and business. This body would coordinate strategy and provide a neutral forum for dialogue.
The government should also create a programme of 'grand challenges' for the fintech industry to tackle, in areas such as machine learning, digital currencies, big data, and mobile payments.
Research councils and Innovate UK should be used to support research into fintech areas, helping to ensure academics have access to world-class data sets. Meanwhile fintech modules should be included in relevant degree courses, says the report.
Another recommendation is the creation of regional hubs to help spread fintech's benefits beyond London. In the budget today, Osborne took the first step towards this, promising to fund an incubator in Leeds.
The state should also put its money where its mouth is by being an "expert strategic commissioner" of fintech, helping to create 'laboratories' for testing new business models. Related to this, the report calls for a system to be developed and overseen by financial regulators, that allows new ideas to be piloted, and new technologies to be tested in virtual and real situations.
In the budget, Osborne said that the FCA's ‘Project Innovate’ will work with HMT and the Prudential Regulation Authority to investigate the feasibility of developing a regulatory ‘sandbox’ for financial services innovators.
Osborne also tasked the FCA and PRA with responding to another of the report's recommendations: the creation of a state-of-the art regulatory reporting and analytics infrastructure, dubbed ‘RegTech’.
Read the full report here:Download the document now 2.2 mb (PDF File)