- Fin Tech
The financial output of the UK has always been a thing of great interest for the world because of its significant figures and economic strength. In recent years, FinTech has risen to popularity and is also a great predictor of the UK’s financial success. It also plays a major role in the development of a digital economy.
There is a strong market for fintech in the UK, which is evident from the following numbers:
- In 2019,financial services accounted for a whopping £132 billion, which is equal to 6.9% of the UK’s cumulative economic output.
- UK’s contribution is tantamount to10% of the global Fintech market.
- London ranks second only after New York, as a core financial centre.
While other countries are gearing up to accelerate the growth of their FinTech infrastructure, it is time for the UK to churn out the exact numbers, and also increase the market share in the coming years. This will help the UK in not only maintaining its position as a ‘FinTech’ hub but also grow as a Fintech market.
With all that being said, let’s proceed to understand some basics, before moving on to understand more specifically about FinTech.
What is FinTech?
FinTech involves the use of new and improved technology that helps in delivering as well as automating financial services. It is an extremely important technology in the making that is not only used for customers but also business owners and companies to get a stronghold on their financial operations.
It makes use of specialised software and improved coding algorithms to get ahead of financial services and improve them. While initially FinTech was used to drive back-end services, with time, it has now been incorporated to provide customer-specific solutions as well. It also includes the buying and selling of cryptocurrencies like Bitcoin, litecoin, and others.
Using Fintech in the UK
According to recent research submitted by EY, the total amount spent in developing technologies to aid financial services in the UK is around £95bn. With the covid 19 pandemic in full swing, closely followed by Brexit, this trend only accelerates.
After the outbreak of the covid-19 pandemic, about 70% of the UK population has gone cashless. There is a considerable expectation for contactless payment and the application of a digital forum for payment options. While the global economy has always been in a rat race for leading fintech solutions, the expectations from customers have only led to an increase in its urgency.
Fintech is also of utmost importance for the UK to be recognised as the leading nation in fintech development. It is an excellent choice for providing enhanced services to customers and also providing excellent solutions for small to medium enterprises (SMEs). It can change the way SMEs operate and improve their productivity to a great extent.
FinTech and Accountancy
Accountants are very influential in the UK’s SME environment and have been conducting their services for decades. Having the most intricate accounting and tax regime to follow, accountants are indispensable in the UK for a small to medium enterprise. Whether it comes to navigating through tax codes or accounting treatments, accountants are truly valuable.
With the UK government launching a number of projects aimed at digitising tax and accounting responsibilities. Accounting firms are gradually expanding to offer services beyond compliance, such as business planning, forecasting, and financial assistance, as simplification leads to commoditization of compliance services.
Even for businesses working with fintech tools, accountants are crucial. Finding the right accountant for a business is extremely crucial, given the way in which propositions are made.
With the expansion of technology in every sector, fintech solutions are being significantly developed in the UK and it is showing a promising future.