Fintech Innovation Perspectives from Singapore and London
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This international research report, in partnership with the Institute of Singapore Chartered Accountants (ISCA), explores the strengths and challenges for Singapore and London as fintech hubs and identifies the key elements that underpin successful fintech innovation.
New technologies such as big data, AI and blockchain can help to transform the way that financial services are delivered, making them cheaper, more efficient, more convenient and more inclusive. ‘Fintech’ is, therefore, a hot topic around the world, with a Fintech Global survey reporting that investment in the sector almost doubled to US$38.9bn between 2014 and 2017. So it’s no surprise that many countries around the world have ambitions to create and grow a fintech sector. But what do they need to do to be successful?
The Five Elements for a Fintech Hub
The concept of a sector hub in economic development is well established – having everything you need in one place supports and accelerates innovation. It enables interaction, learning and building of networks between innovators, investors and regulators. It can also support specialisation and economies of scale.
In the case of fintech innovation, there are five key elements that underpin a successful hub:
- Talent – the right mix of technology skills, financial services knowledge and innovation and customer-centric thinking
- Capital – funding to support the startup and expansion of fintech businesses
- Markets – customers to buy new fintech products and services. Fintech companies can market directly to consumers or businesses and compete with the established sector, or they can sell their products and services to other financial services companies and thereby partner with the established sector
- Regulation – regulators who work closely with the fintech sector, and encourage innovation while managing new risks and protecting customers
- Government support – a wide range of activities which support investment, help to deliver the right talent and enable the growth of new markets
London and Singapore consistently rate highly as leading fintech hubs, and they both benefit from having all five of these elements in a single location. They see their progressive regulators, in particular, as providing a significant competitive advantage in bringing new products and services into the marketplace. Furthermore, both hubs have mature and successful financial services sectors already, which provides strong foundations for fintech.
To read the full article from ICAEW, please click the link below.