Economic secretary to the Treasury, Andrew Griffith MP, spoke in a keynote speech outlining the government’s ambitions for the fintech industry during day one of the Innovate Finance Global Summit 2023.
Griffith opened by stating that financial services is at the heart of the UK’s economy and wealth creation, and that the fintech community plays a huge role in the future of the nation, adding that nearly half of Europe’s fintechs are UK-based.
On the impact of the recent collapse of Silicon Valley Bank, Griffith pointed out that the government continues to support the sector and is intent on being communicative and accessible in order to make quick decisions and protect the UK fintech sector.
As the first of three key announcements made during his session, Griffith told IFGS attendees that that the Treasury which recently launched the Centre for Finance, Innovation, and Technology (CFIT) in Leeds, will be focusing on how open finance can benefit the UK economy. Expanding on the launch, Griffith stated: “Its central task is to bring together industry players, entrepreneurs, policymakers, investors, academics, to coalition's to address some of the trickiest challenges facing the sector.I'm delighted to announce today that CFIT’s first coalition will look at open finance and how unlocking financial data can benefit small businesses, entrepreneurs and consumers.”
Griffith stated that open finance is the logical next step after open banking. UK is a world leader in open banking, boasting 7 million users, over one billion successful APIs calls every month, and thousands of new businesses and products created.
The next major announcement Griffith made was to move open banking to a sustainable regulatory framework, a move facilitated by the Data Protection and Digital Identity Bill which is currently in reading at Parliament.
“Open banking will also transition to a new entity with a broad based equitable funding model and high standards of corporate governance and today we also set out how we plan to get this transition started this year.”
The Joint Regulatory Oversight Committee (JROC), co-chaired by the FCA and the Payment Systems Regulator (PSR), say the measures will bring "opportunities for new products and services, allowing consumers and businesses to share data and make payments in more convenient and efficient ways".
Griffith stated: “This morning, the committee [JROC] set out its recommendations with a vision of data sharing market, which is competitive and scalable for the long term.”
Griffith then touched on new developments in AI technology, and how financial services has been employing AI to enhance customer service, prevent financial crime, and make more informed decisions. He directed the audience to a recent whitepaper published by the Government on AI governance, which details how the UK is approaching the topic.
Furthermore, Griffith stated that the government invested £900 million to build a supercomputer and establish a new national AI research resource.
Griffith’s final announcement was on the launch of a new UK Fintech Census, in collaboration with the City of London and Innovate Finance, which will run for five weeks and wills seek to compile responses fromall 2,500 fintechs in the country. The census will be repeated annually.