How Brexit Will Affect the UK Fintech Industry? Experts Answer
Max Yakubowski's original article for cointelegraph.com reduced by 79%
Would Brexit's effects be positive or negative for the fintech industry in the United Kingdom? We asked experts from the London Fintech Week, the U.K. in a Changing Europe, the University of Nottingham and more. Although the U.K.
gained its position back in 2015 "As the world's leading global financial services centre," with an ambition to become a world leader in developing fintech as well as a global hub for financial innovation, Brexit leaves a major concern within the crypto industry: How might the U.K. deal with crypto after Brexit? Some research has shown the negative effects that Brexit raised among financial services organizations within the U.K. For example, a report from TheCityUK underlines a significant decrease in the required tech talents in the fintech sector and a report from NewFinancial stresses that fintech businesses are moving from the U.K.
to the E.U. in preparation for Brexit. "In combination with a diverse talent pool, active government support for foreign investment, and regulators progressively levelling the playing field between fintech entrants and incumbent institutions.
The U.K. is a global fintech leader and will remain so, Brexit notwithstanding." "It is hard to predict the precise direction fintech businesses in the U.K. will take after Brexit.
Like all parts of the financial services sector, the outcome will depend on the type of Brexit the U.K. sees. However, the impact on fintech is especially hard to predict because its success depends on a number of policy areas, each of which will see different Brexit impacts."For example, the U.K.
has stimulated the fintech sector through a regulatory regime that facilitates innovation and this could see an acceleration after Brexit if the U.K. does not seek convergence with the EU regulatory landscape. "The best thing that could happen for the U.K.
fintech industry, would be for Brexit to take place under the Withdrawal Agreement. In short, this would increase the likelihood for the status quo for the U.K. financial industry to be conserved, even if the inevitable harm to the U.K.
economy caused by Brexit does cause some disruptions." "We have seen that despite the chaos surrounding Brexit, British fintechs are doing better than ever. There are three major factors in this success: the access to highly-qualified international talent, the presence of financial institutions and the connections with overseas funds. If the divorce were to affect any of these, there's a significant chance the U.K.
would lose its lead in the fintech scene. I also believe that hard or No-Deal Brexit will have negative effects on the fintech scene and the overall startup ecosystem."Having rated over 2,600 early stage startups, we know the quality of the team has the biggest impact on growth potential.
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