Speaking at the opening of London Fintech Week, Lord Anthony St John has predicted that fintech will account for all financial services in 20 years’ time.
Lord St John believes also that London is the city that will drive this evolution thanks to its current presence of financial and professional services firms and helpful regulatory environment for fintech start-ups.
He cited the fact that financial services in the UK have a 42% fintech adoption rate, which compares to 33% elsewhere.
“We have a joined-up system in London,” Lord St John told the audience.
“We have government, we have Innovate Finance, we have the young start-ups, and we have the Deepminds of the world.
“Our regulatory frameworks allows start-ups to rapidly scale up, so it’s very important that the Sandbox continues to nurture innovation.
These words echo the testament of Alastair Lukies, chair of the UK Fintech Alliance, who recently declared London “the best place for fintech in the world”.
Fintech accounts for 18 of the UK’s 72 unicorns, which amounts to a third of those across the whole of Europe.
Investment in the UK fintech industry totalled $3.3bn in 2018, which takes third place globally behind the US and China.
Lord St John highlighted some of the challenges and opportunities that lie ahead for fintech providers alongside traditional financial services companies in the years ahead.
“There are 1.2 million people in the UK without bank accounts; 16 million people have fewer than £100 in their savings account; 10% of UK households do not have internet access.”
The crossbench peer also highlighted the importance that financial services firms take note of the fintech start-up sector’s diverse working practices and culture.
Despite promises to the contrary at the beginning of his address, Lord St John also brought up the dreaded Brexit, pointing out the importance that the UK retains the skilled labour needed to man the fintech sector once it departs the European Union.