Treasury has published the Kalifa Review of UK Fintech, which launched last summer. The report sets out proposals for the UK to build on its existing strengths in the sector. The review looks at the development, challenges and future of the sector. It identifies as the key threats to the UK’s current fintech leadership position competition, Brexit and Covid, and proposes a 5 point plan to ensure the UK can retain its position by creating and maintaining jobs, enabling trade and supporting inclusion and recovery. The steps are:
- policy and regulation
- international and
- national connectivity
From a financial regulatory point of view, the review recommends a “Scalebox”, an enhancement of the Sandbox, to make permanent FCA’s digital sandbox pilot and encourage partnerships between incumbents and fintech/regtech firms, while also providing support for growing firms once regulated. The CMA, it says, needs to adapt its approach to the sector so it can better balance competition and growth.
For further thoughts on the Review, please see our thought piece from Fintech partner Alistair Mitton, here.