Navigating 2024: Priorities from FinTech Scotland’s CEO, Nicola Anderson

As we step into the early months of 2024, I’m reflecting on the achievements and progress across the FinTech Scotland Cluster over the past six years, and am also focused on the year ahead to build on the work so far and enable more opportunities for fintech innovation. 

The FinTech Scotland Cluster is a vibrant and diverse ecosystem that’s driven by contributions from a diverse range of committed participants focused on shaping the future of financial services. It goes without saying that technology is a critical focus, but we also find that there is a purposeful intent to the commitments to support the needs of a successful economy, one that’s becoming more and more digital. 

It’s the commitment from all involved in the Cluster that has resulted in a number of significant achievements over the years, including:

1. Continued growth in fintech SMEs and fintech jobs, 
2. Greater collaboration between larger organisations and smaller fintechs,
3. Development of new innovative products, services and partnerships that all ultimately deliver good customer outcomes, and 
4. A deepening focus on fintech R&D driven by the research excellence from the universities in Scotland and by collaboration on industry priorities in the FinTech Research and Innovation Roadmap (R&I Roadmap).

So, despite the challenging economic environment, I am optimistic about our opportunities for growth and innovation. In particular, I am looking forward to deepening our approach of collaborate to innovate’, and the limitless potential this powerful combination offers. We see it working already, resulting in changes for customers, businesses, our economy and the environment, supporting future needs and the development of fintech-enabled financial services in Scotland and across the UK. 

A new year brings an opportunity to assess our priorities for the year ahead. We’re focused on propelling our fintech cluster forward, deepening connections across the UK and the world, as well as accelerating fintech SME growth. 

Innovation and Priorities in 2024:

Fintech Growth

The FinTech Scotland community of fintech SMEs continues to grow, with 227 businesses currently developing and delivering fintech products and services that meet business and citizen needs. Accelerating their success and enabling them to grow and scale requires a collective focus on investment, access to current market opportunities (which includes collaboration with financial institutions), and supporting their ambitions to export.  

We’re spurred on by January triumphs already. 

Snugg, a thriving fintech, kicked off the year by announcing success on both funding and collaboration that will help them expand and scale throughout 2024.

Broadridge Financial Solutions, a growing and global fintech, announced success in international markets working with Denmark’s Danske Bank, exporting services and continuing its global growth.

Encompass Corporation has also started the year off by continuing its global expansion and growth through acquisitions.

We will continue to focus on investment, growth and international opportunities for the fintech SMEs throughout 2024.

Impactful collaboration

Working with the big and small 

We saw growing success throughout 2023 in the fintech programmes delivered in association with Lloyds Banking Group, TSB and Phoenix Group. Within our approach of collaborate to innovate’, more partnerships emerged, and fintech enterprises benefited from hearing about priority needs directly from the market. 

There is more to come in 2024. Collaborate to innovate’, through practical innovation programmes, will enable more potential for commercial opportunities and support new ways for market adoption of new and emerging technologies. We’re commencing the year with an innovation call on using AI and emerging technologies to help simplify compliance. 

The role we see for R&D

In 2023, we launched the Financial Regulation Innovation Lab, with an agenda focused on how technology can simplify and support compliance, and help regulation develop. The Lab also creates an independent environment to enable industry collaboration on current and emerging challenges within financial services. It’s a privilege to work with all involved, including UK regulators, large financial institutions and fintechs, as well as the University of Strathclyde and the University of Glasgow.

The Lab is kicking off 2024 with a collaborative research and innovation programme focused on AI and emerging technologies, and looking at their application in ESG regulations, Consumer Duty requirements and addressing Financial Crime. You’ll hear more about the progress throughout the upcoming year, and if you’d like to learn more now please let me know. 

Financial inclusion continues as a pressing issue. The cost of living crisis has brought it into further focus and the FCA’s Financial Lives survey persists in demonstrating a need for change. Throughout 2024, we will work with Financial Inclusion for Scotland, the FCA and Scottish Financial Enterprise, and explore how technology and a heightened period of focus can help move the dial on this critical problem. 

We’ve initiated this already, working in collaboration with the FCA on a Financial Inclusion TechSprint (more details can be found here). The Sprint is focused on helping to find ways to enable those excluded from basic financial services to get access. There’s a firm belief that technology can help, and that collaboration and a willingness to find solutions is key. The Sprint will run from March until the end of May, and conclude with an event in Glasgow. I’m starting 2024 hopeful we can drive change on this difficult agenda. The invitation to get involved is open to all. 

Working on priority environmental issues

With the climate agenda critical to so many aspects of business and society, it’s no surprise that fintech enterprises are working to find solutions and services that will help – indeed, the number of Scottish fintechs focused on climate doubled in 2023. In addition, we saw accelerated learning across the cluster through our work with Space Scotland, increasing our knowledge and understanding of geospatial data. 

There is more to come through 2024 on the priority of climate finance. We’ll build on the lessons and experiences from Space Scotland, exploring application of geospatial data in insurance risks, investments, emerging regulatory requirements and ESG development. 

Inclusive Cluster leadership

We will continue to work across the UK to advance fintech innovation. The FinTech Scotland team will continue to progress collaborative opportunities across the nation, working with the Centre for Finance, Innovation and Technology (CFIT), the Fintech National Network, Innovate Finance and The City of London Corporation. We will work, learn and collaborate across the regions to accelerate the whole of the UK’s fintech potential.

We invite you to collaborate with us

We know purposeful collaboration is key – collaboration across the industry, across sectors, and amongst other fintech clusters – to help us drive and lead the future of the digital economy.

My call to action for 2024 is: Collaborate with us, and innovate. 

A FinTech welcome to 2023!

January 2023 marks FinTech Scotland’s 5^th birthday! Across that time we’ve seen fintech numbers grow, investment build, partnerships develop, international opportunities prosper and fintech adoption accelerate.

The occasion gives us an opportunity to reflect, consider the future and celebrate the fantastic progress of fintech firms in Scotland.

Over the years these fintech businesses have grown in number, collectively raised over £530m in investment and continue to build businesses with longevity and scale in mind, that deliver positive outcomes for people, businesses and society. It’s a resilient and inspiring group of innovators and leaders and I’m looking forward to the year ahead and the future opportunities to come.

The birthday celebrations were one reason to cheer, another was the news that Stephen Ingledew, our founding father and now our Executive Chair was honoured in the New Years honours list!

A further cause for celebration on two fronts.

Firstly, it’s a richly deserved mark of Stephen’s leadership and commitment, and secondly, it’s another indication of the value that’s placed on fintech innovation across the UK. We’ve always known the value that fintech will bring and it’s given us a further spring in our step as we welcome the possibilities for 2023.

We started those possibilities with an event connecting Space innovation and FinTech innovation. On a bright morning on the 11^th of January, in a room full of space tech and fintech innovators, financial and professional service experts we gathered to discuss what we could achieve if we explored the connection between Finance and, Satellite data such as earth observational data or EO to those working in the Space sector.

The answer came when we joined the dots on sustainable finance, and ESG’.  There are several pioneering companies, already innovating in this space.

Trade in Space, EarthBlox, Space Intelligence or Terrabotics are great examples of fintechs using earth observational data and technology. Their capabilities can help build confidence in green investing, will shape the future of infrastructure and real estate insurance, build clarity on the environmental impact of supply chains, and help businesses demonstrate regulatory compliance!

The day set the tone for more to come, watch this space!

Data Driven Innovation continues to inspire us, and while we might be at the beginning of our work with Space to drive Climate-FinTech possibilities, other data driven innovators are striving ahead.

January has seen an even stronger renewed focus on financial inclusion, with fintechs including Inicio.ai, Amiqus, DirectID, MoneyMatix, Soar and Inbest.ai continuing to grow and deliver change for citizens across Scotland and the UK.

More than ever, we’re confident that the purpose and intent from the Scotland’s fintech community will help drive the products and services needed to help address the challenges we continue to face.

The potential for 2023 continues, with partnerships and investment top priorities.   Br-dge kicked off the year announcing its partnership with Visa and its growth plans for the year ahead! Gigged.ai kicked off investment news with a £1.6m raise to fuel next stage development.

And I’m looking forward to more! Welcome 2023, I’m looking forward to seeing business grow, fintechs scale, investment continue, and more collaboration develop.

On a personal note I’m looking forward to more daytime daylight and a stretch to the evening!

I’m also looking forward to seeing you in February! Please join us on Wednesday 15 February for our first in-person gathering of the year as we celebrate success and look forward to 2023.

Fintech in Scotland – Connect, Collaborate, and Cultivate

FinTech research and Innovation ”“ the future of finance

This month we published our FinTech Research and Innovation Roadmap. We know more research and innovation in financial services and fintech will set us on a course to shape the future of finance.

It’s been in the works over recent months, and it’s allowed us an opportunity to hear industry, consumer academic, and innovators views on what the future of finance and fintech could be. Leading the way!

It’s a genuine privilege to hear the ambition and determination across the fintech and finance industry for a future that means less friction in financial services, enables more inclusion using technology and data, and drives climate change enabling greener investments.

The tone from all was clear, fintech will drive better financial outcomes for people, businesses, our society, and the environment. The desire for change and energy for innovation and collaboration is truly inspiring.

The report gives us a framework for focused collaboration. It identifies 4 priority themes and outlines the primary actions that will enable us all to learn, advance, and most importantly, build the right collaborations to drive and lead future fintech innovation. It was published during the first anniversary of the Kalifa review of UK Fintech where more R&D was a specific recommendation.

The first of those priority themes in Open Finance Data ”“ already an area of strength in Scotland! FinTech businesses such as DirectID, Visible Capital, Inbest, AirFunders, and One Bank all use Open Finance Data in their businesses. This experience along with the investment in the Global Open Finance Centre of Excellence, now known as the Smart Data Foundry sets us on a course to explore how Open Finance Data can change the way we do finance in the UK and across the world.

Climate Finance is another key priority ”“ a growing area of strength and focus for Scotland. FinTech businesses such as Snugg, Coastr, Pulse, Iceni Earth, Trade in Space, and Space Intelligence are all focused on using data and technology to help people and businesses make the changes needed to achieve change in the interests of the planet. These businesses are enabling a different future. The same can be said for the research community in Scotland with centres such as The Centre for Sustainable Developmentand the Edinburgh Climate Change Institute leading research and providing deeper and focused insights on climate impact. From this place of understanding more will change.

Payments and transactions’, as well as Financial Regulation’ complete the 4 priority themes. Again, both assets for Scotland, where the depth of fintech innovation, skills and expertise stand Scotland’s FinTech Cluster in great stead. More on both these themes in the coming weeks and months.

For now, we’re gearing up for UK FinTech next week. There’s a host of events in plan where we’ll have an opportunity to share the wonderful work happening across FinTech Scotland.

I’m signing off with a note of thanks and a special note of thanks to everyone who contributed to the FinTech Research and Innovation Roadmap.

The Roadmap is a true demonstration of Scotland’s FinTech Cluster at its best. It highlights the breadth of contribution to the cluster that allows us to learn, collaborate and inspire each other for development and growth. It shows how our commitment to action for positive change, and it is ambitious, challenging us to think ten years ahead so we can lead the future of finance.

I’m looking forward to seeing this advance and working with the inspiring leaders, innovators, entrepreneurs, and educators as we build and teach the future!

Thank you

Nicola

An end of year “Thank You” message from our CEO

As we come to the end of 2021 and look forward to 2022, we’re reflecting on the year and are hugely proud of what’s been happening across Scotland’s FinTech Cluster. Despite the continuing challenges from the COVID-19 pandemic we’ve seen fintech SME Growth, both in number of businesses and in terms of scale, we’ve seen record levels of investment in Scottish fintech SME’s, a true testament to the calibre of the businesses and leaders who continue to inspire us day on day.

The past twelve months have also seen more international growth with up to 50% of Scotland’s fintech SME’s building plans for international trade and more global businesses locating to Scotland as they establish a UK base.

We’ve also had the Kalifa review of UK fintech acknowledge the established progress of Scotland’s FinTech Cluster, and we’re looking forward to supporting the implementation of the Scottish Technology Ecosystem Review led by Mark Logan and building a plan to enable Scotland’s future digital economy.

The FinTech Scotland festival provided us all with an opportunity to meet again face to face and if we needed it, it reinforced the energy, optimism, diversity of contribution and breadth of collaboration that contribute to our fintech successes. A highlight for all of us in the FinTech Scotland team were the hybrid and in person events, kicking off with the DIGIT FinTech summit and ending with the Times and Futurescot event where we welcomed the UK regional fintech clusters to Scotland in the Accelerating UK FinTech conference.

During 2021 we have seen a growth in climate fintech, with new fintech SME’s starting to develop businesses to help address the impact of climate change and support the journey to net-zero, as well as established fintech SME’s expanding their existing capabilities to tackle this important issue. I have no doubt we’ll see more of this in 2022 and we’re looking forward to doing more to stimulate and accelerate climate fintech in Scotland.

With the establishment of the Scotland fintech SME advisory Board we have a clear plan on fintech SME priorities for 2022, and it is a privilege to work with these dedicated leaders who have come together aligned behind the vision of economic, social, and sustainable growth across the FinTech Scotland Cluster.

Looking forward to 2022 we’re focused on supporting fintech SME’s to scale and grow, strengthening international connections, building more impactful fintech collaborations and deliberately driving more fintech Research and Innovation (R&I) in Scotland and across the UK. We plan to launch the FinTech Scotland R&I roadmap early in 2022. It’s a plan that pulls together industry R&I priorities as we ask ourselves, what should finance look like in 10 years-time, and it provides us with a framework to lead the answers to that important question.

In drawing to a close, I’d like to say thank you to everyone that’s supported the FinTech Scotland Cluster across 2021. I’m continually reminded of the privilege it is, to know you and work with you in our collective efforts to lead and achieve our ambitions for fintech in Scotland. I’d also like to say a special word of thanks to the brilliant team at FinTech Scotland. I see their energy, commitment and drive everyday and it’s a pleasure to work them.

My final note is to wish you all a happy and healthy 2022 and we’ll look forward to seeing you all next year as we continue to build on our plans and drive the FinTech Scotland Cluster.

Scotland Fintech festival! We loved it and can’t wait for next year!

We recently concluded the FinTech Scotland festival ending a wonderful four weeks where we got to celebrate fintech innovation in Scotland, across the UK and around the world!

With 60 events covering a broad range of interesting topics, discussions, and views for the future there was plenty to talk about and more to excite us for the next 12 months ahead.

We started in Edinburgh and ended in Glasgow taking a trip around the world via Australia, America, Europe, Dundee, Stirling and London!

Among my favourites were the face to face events, where the buzz and energy in the room confirmed there’s much going on in FinTech innovation in Scotland, and that we all were excited to be out and about reconnecting face to face, enjoying new conversations and sparking new ideas.

Digit’s FinTech Summit kicked everything off in true Digit style. It was great to see Visible Capital, LendingCrowd, Amiqus, Sustainably, ShareIn, Zumo, Nude, Exizent and Love Electric, all Scottish home grown fintech talents, building and scaling businesses, and developing the future of finance.

Other one of my favourite events was a truly brilliant and informative discussion on the meeting of Space Data and FinTech! Thank you, the University of Strathclyde, Trade in Space, Go-to-Market for sharing your insights, experience and expertise on how Space Data gives us an exciting prospect for more fintech innovation!

FinTech innovators never fail to inspire me, it was an privilege to share an event that saw Know-it, Doqit, Biscuit Tin, PolyDigi and Gigged.ai talk about their businesses, innovations and aspirations for the future.

We connected around the world, sharing experiences of Open Banking innovation with FinTech Australia and hearing directly from a range of European regulators on their experiences of fintech.

Our own regulator the FCA hosted a record number of events covering topics from crypto, Innovation, Sustainable finance and RegTech!

We rounded the festival off in Glasgow with the Times Scotland and Canongate event and an opportunity to discuss accelerating fintech across the UK! Another event that reminded me of the value of connection, the true potential for UK fintech innovation and role that Scotland plays in influencing that story and setting direction.

Thank you for joining us, being part of our story and helping us to shape the future.

FinTech Scotland looking ahead and looking forward!

With August literally just around the corner we’re inching closer to the FinTech Scotland Festival which starts on the 16^th of September with Digit’s FinTech Summit.

This year we’re hoping to see a return to some face-to-face events and are looking forward to catching up in person with so many of you working across Scotland and UK fintech clusters. We’re starting to see more opportunities for those in person meet ups, respecting the opportunity to start seeing people again in a safe way. Personally, I’m finding it invigorating and energy building talking face to face with those inspiring and committed to driving change through fintech innovation.

That energy was more than evident in a FinTech Scotland meeting with Liz Truss, the Secretary of State for International Trade earlier in July. Not only was it good to see everyone in a (large) meeting room, but it was also great to hear directly from the leaders in Trace Data, Direct ID, Float, EedenBull, Modulr, FreeAgent on their plans and views on international trade and how Scotland is leading and building world class data driven innovations. Key markets discussed included the US, Asia and Australia. Opportunities are growing and many of the events in the festival will focus on international trade opportunities helping to build local understanding of fintech markets in Australia and other countries. (Link to the FinTech Australia event).

We’ve also been working closely with the University of Edinburgh and Edinburgh Innovations on a Data Driven Entrepreneurial Programme that is focused on the application of PhD research into industry and in building businesses. All the enterprises are using technology and data and are building innovative solutions across a host of issues, including climate change, economic recovery and financial wellbeing. The team at Space Intelligence is focused on managing environmental risks using technology and space data analytics to monitor carbon reducing initiatives. I also met Iceni Earth this week, another climate fintech innovation, and providing leadership and practical applications that supports agriculture and better land use. I’m constantly reminded how privileged and lucky we are in FinTech Scotland with continuous connections to new innovations supporting future business developments.

Over the coming weeks and months, we’ll be doing more on climate and fintech. The FCA recently announced a range of planned innovation programmes for later in 2021 starting with a Tech Sprint in October on the topic of ESG data and helping build market confidence towards ESG credentials and the environmental impact of financial decisions. There is more information here, and it’s another opportunity for Scotland to showcase its strengths in innovation, driving purposeful change and building collaboration to achieve Net Zero ambitions.

The topic of fintech’s role to address climate change was also discussed on one of the FinTech Scotland podcasts in July, it’s a great listen!

Fintech – supporting business growth and recovery

As we emerge from lockdown determined to experience the things we missed the most, we can also be confident that some of the developments we saw during the pandemic will remain.

I was reminded of this recently when I heard some of Scotland’s business community share their hopes, aims and ambitions for a post Covid recovery, while being candid about consumer expectations and the efficiencies digital interactions allow. Recovery and development in the ever-evolving digital economy was firmly part of the discussion as well as the role that fintech can play in enabling both.

Fintech is a key component in a developing digital economy that demands services and products to meet consumers changing habits, and help businesses deliver efficient and cost-effective operations. It is the thread that financially connects businesses with customers and suppliers and vice versa.

What’s exciting is the range of FinTech businesses in Scotland who are all working in this environment and here already, working with commercial and business customers.

They enable business owners to make truly informed decisions, using technology to analyse business and financial data to provide an accurate and up to date (often up to the minute) picture of their business. Float helps businesses make informed decisions about their cash. It’s an online cash management and forecasting tool that helps business leaders manage their business and make decisions with confidence.

Other fintech are providing a range of new digital tools to help businesses when it comes to managing payments, revenue, invoices, suppliers, and creditors. Know-It enables businesses to automate their credit control processes helping to manage credit risk, reduce debtor days improve cashflow and the businesses understanding of its customers.  Optimum Finance another fintech uses technology and data to unlock cash tied up in unpaid invoices supporting business with flexible invoice financing options.  Modulr works to simplify business payments including staff payments, merchant services, supplier payment workflows or payments reconciliation, helping to improve operational efficiencies.

FinTech’s in Scotland are also creating an accessible and transparent alternative to bank lending helping the non-bank lending sector to grow.  LendingCrowd has been working in this capacity since 2014. Authorised by the UK financial regulators it supports ambitious SME’s to grow their business by providing a range of funding and lending options including working capital loans, growth finance and the recent Coronavirus Business Interruption Loan Scheme (CBILS).

I’m continually reminded of the dedication and profound purpose of fintech founders in Scotland. It’s even more apparent in the fintech’s focused on the business and commercial sectors. These fintech teams continue to inspire us at FinTech Scotland with their focus and determination to use fintech capabilities to help the business sector recover post COVID.