11/12/14 The financial technology, or fintech, sector represents one of the biggest opportunities for economic growth in the UK, according to Steve Varley, chairman and managing partner of EY, which is likely to generate jobs as the £20 billion industry gears up for rapid growth.
At the same time, new figures released this week show that the UK’s financial sector is on a hiring spree as banks beef up their digital operations.
Astbury Marsden, a recruitment firm, said 3,400 jobs were filled or created in the City of London in October, up 46% on the same month in 2013, driven by investment in digitising business.
“Fintech [is] a growing segment of the technology start-up scene that is disrupting sectors such as payments, loans, fundraising and wealth management,” Steve said, speaking at the CBI business group’s annual conference in London.
The chairman of EY for UK and Ireland highlighted a report from the leading accounting firm which says the UK is a destination of choice for companies wanting to establish a global presence in the financial technology sector. EY estimates that fintech is one of three industries set to generate a combined £300 billion by 2020.
He said the fintech sector is led by a cluster of leading firms which already make up 18% of the UK’s financial tech market. Some of the most successful are London-based and run by business school graduates. These include Transferwise, the money transfer company founded by an INSEAD MBA graduate that raised $25 million earlier this year, and Nutmeg, an online wealth management business that has received $50 million in funding and was founded by an MBA graduate of Stanford GSB in California.
Transferwise is expected to raise another significant round of investment that would send its valuation soaring.
“These are firms that are disrupting existing models across the financial services sector, and in turn challenging our traditional providers to be more innovative,” said Steve.
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