Chancellor Philip Hammond increases his expectations on the UK’s tech sector, piling on the pressure for new tech businesses to surface.
London is Europe’s top destination for tech talent and a new tech business is born here every hour. “I want to make that every half hour” said Chancellor Philip Hammond this morning, speaking at today’s HMT FinTech conference, adding that “our doors will always be open to the innovators and the inventors.”
Industry enthusiasm about the possibilities in the fintech sector particularly remains high, with a massive 94 percent of the UK’s fintech company’s – perhaps unsurprisingly – seeing the advent of Open Banking as a major opportunity, according to a new survey of 31 company by EY.
The report, launched today at the conference, comes as Open Banking (essentially the UK version of the EU’s second Payment Services Directive, or PSD2) forces the country’s major current account providers to open their customer data via open APIs.
It was released as OakNorth this week became the first of the UK challenger banks to return an annual profit, recording a pre-tax gain of £10.6m after its second full year of operations, as reported by the FT. The bank specialises in lending to startups. It generated net interest income of £24.9m in 2017, up from £7.2m the previous year – tripling the size of its loan book over the same period to £851.5m, according to filings at Companies House.
The sign was just the latest that the emergence of a more open banking marketplace might be reaping dividends for its early adopters: earlier this month so-called “challenger banks” won big at the British Bank Awards, run by the consumer review website Smart Money People – which polled over 24,000 UK consumers for the award.
Startlingly, the top five providers. Starling Bank topped the poll, followed by close rival Monzo. Starling also won “Best Current Account Provider”.
The fintechs EY surveyed have collectively raised some £500m in equity investment and employ 2,500 staff, the company said, with 59 percent using Open Banking as an opportunity to review their collaboration strategies, EY’s report found.