The UK fintech industry has grown rapidly over the past decade and as we reach an important crossroads, we need to consider how collaboration can drive the sector towards further success while continuing to drive value for customers by making their lives easier.
Someone with clear thoughts on this is Jill Docherty, Head of Business Development, UK & Ireland at Visa, the global payments technology company. With over 20 years of experience across emerging and developed markets within consumer packaged goods & financial services, here Jill explains how collaboration can define the future success of UK fintech.
The recent Kalifa Review showed that the UK fintech sector is a success story, now representing 10% of the global market share and £11bn in revenue. The review also highlighted the value of continual innovation as the key to sustained growth. The ambitious new plans announced by the Treasury to launch a Centre for Finance, Innovation and Technology are a strong step in the right direction.
When identifying the path to success, it is important to remember that no single company holds all of the answers. It’s through shared ecosystems and open networks we can collaborate and forge partnerships to develop the most innovative and disruptive solutions that support the end-user.
It’s important to remember that fintech innovation is more than just growth – open networks are offering us the opportunity to tackle the toughest issues in society. As the pace of digital transformation accelerates, we must ensure that we’re not forgetting about those who aren’t as digitally connected. We recognise the part we play in enabling people to choose how they pay and are paid, however, inclusivity in the digital economy goes beyond payments. Collaborations with fintechs is about encouraging social inclusion, diversifying our collective workforce, enabling communities to interact with online services and improving financial education so people don’t feel excluded by a lack of knowledge.
90% of UK consumers surveyed feel they are uneducated in terms of personal finance, with most financial literacy issues forming from a young age. Visa is working together with fintechs to share knowledge and skills with younger generations so that children can build financial literacy from an early age. Through this, we’ve been able to teach children financial control, forming important saving habits from a young age that will help them later in life.
The acceleration of shifting consumer habits means we must stay ahead of the curve and continue to reach customers in new and digital ways. We’ve already witnessed major changes; in the UK, 80% of in-store payments are now contactless, with nearly half (49%) of shoppers surveyed now preferring to pay by contactless wherever possible. As this method of paying becomes further engrained in our everyday lives, the challenge becomes finding the next solution that will spark excitement.
One of the key developments of the past few years is real-time payments. It’s no longer accepted that that paying or getting paid could take days, in a world where customers are used to instant experiences, they also expect to send and receive money faster. Through Visa Direct, our solution for enabling real-time peer-to-peer payments, customers around the world can send money to instantly to friends, family and businesses. We expect this innovation to become the new norm in many cases, resulting in smoother payments for everyone.
Recent months have also seen the value of digital currencies soar and we expect customer interest in this to continue to grow over the coming years. Visa recently announced a new partnership to start settling transactions in USD coin and we think this marks a major milestone in our efforts to offer customers all around the world the opportunity to choose how to pay and be paid.
I’m confident that through collaboration we can focus our efforts on this cutting-edge payment technology, finding new ways to meet the needs of the next generation and ensure that UK fintech continues to lead this cause.