“What Manchester thinks today, the rest of the world thinks tomorrow”.
It’s a truism that has existed in various forms throughout the years, and has often been attributed to former Prime Minister Disraeli – but this time the honour belongs to Susan Hall, a Partner in Intellectual Property at Clarke Willmott.
Susan was speaking at Pro-Manchester’s widely-anticipated FinTech Lunch event, hosted at First Street’s INNSiDE on September 24th. Sponsored by Clarke Willmott, Yobah and Open Money, the day brought together key industry figures from across the city to discuss finance and treasury management, digital banking solutions, FinTech’s role in education, and plenty more.
The sectorial diversity of Manchester’s business scene was on full display, as guests and speakers ranged from a variety of start-ups to members of the Department for International Trade.
It might go without saying, but AccessPay were there too.
Our Head of Enterprise Sales Tom Livock provided valuable insight about Manchester’s FinTech credentials (which we’ll discuss shortly) – but we also attended in a more observational capacity.
In fact, we’ve compiled a series of crucial takeaways for those of you who were unable to attend.
Let’s break down what we learned at the FinTech Lunch.
UK FinTech is Important to the Government
Over the past several years, there’s been a growing alphabet of humorously-designated taboo words and topics – both socially and in business.
Most notable are the dreaded B-word (Brexit) and C-word (Covid), the latter of which led to many an awkward handshake (which was in itself an effective icebreaker) at the FinTech Lunch as people acclimatised to their first post-pandemic corporate event.
Given the all-encompassing importance of these subjects, it perhaps came as a relief to several attendees to see government representation in Rebekah O’Connor, Head of FinTech and Innovation at the Department for International Trade.
Crucially, her message was clear: “FinTech is very important to the UK Government”.
As recently as April, the government enacted a series of export support measures in order to support both the FinTech sector and the nation’s wider economic recovery. This included the bespoke FinTech Export Academy and FinTech Champions scheme to provide 1-2-1, sector-specific advice, helping out the roughly 76,500 people UK workers employed by the growing industry.
While Rebekah reaffirmed the economic importance of the FinTech scene – it’s worth more than £11 billion – she also admitted that collectively “we don’t shout about UK FinTech enough”.
Manchester Remains a Vital FinTech Hub
Joining Rebekah on the International panel was AccessPay’s Tom Livock, who was equally quick to emphasise the importance of Manchester more specifically in the FinTech landscape.
“I hate to say, but we started in London” he admits, “but the idea was always to move to Manchester”.
AccessPay aren’t alone in singling out Manchester as not only a viable alternative to London, but a thriving and rapidly expanding FinTech hub. In fact, recent reports suggest that outside of the capital, Greater Manchester is the largest regional FinTech ecosystem in England.
Our Head of Enterprise Sales gave the audience three distinct reasons for AccessPay’s move: a vast pool of upcoming talent to be tapped into, a significantly reduced cost of business, and the fact that most well-regarded banks – such as RBS, HSBC, Lloyds, Santander and more – were already based in the city.
These were sentiments echoed by fellow panellist Rachel of MIDAS, who noted that “we want more FinTechs to use Manchester not just as a regional area, but as an international HQ”.
The beginnings of this can already be seen through notable, rapidly-emerging FinTechs such as Klarna expanding their operations throughout Manchester.
Co-opetition Might be the Way Forward
It’s important to emphasise that while we’re currently talking about FinTech as a singular entity, the sector is a broad church with businesses of different intents and ambitions.
This was agreed upon by the FinTech Lunch’s Co-opetition panel, comprised in part of Mark Hartley, Founder and CEO of BankiFi, and Jonathan Thompson, Co-Founder, Executive Director and CEO of Bank North.
On this second panel, the disruptiveness of early FinTech – and the potential impracticality of start-ups of this nature – were discussed, issuing a call for increased mutuality between banks and the emerging wave of financial services characterised by modernity.
“We had what I would describe as FinTech 1.0 in the early 2010s”, Mark notes, describing this era’s desire to achieve a subversive “unbundling of banking services”.
While this prototypal, disruptive branch of FinTech made its mark, there appears to be an emerging desire for FinTechs that are both profitable and sustainable, working with banks as opposed to challenging them.
This coincides with a realisation that these so-called sides – banks and financial services – may actually need one another.
“The banks are seen as the evil Empire, as opposed to newer financial services that are the heroic Rebels” Mark elaborates, drawing chuckles from across the room, “but is Buy Now Pay Later really good? Or is it the next scandal waiting to happen?”
Raising Awareness is Essential
A fundamental problem remains: many people – even those in the corporate world – simply don’t know or understand what FinTech is.
While we can begin to thank figures like Elon Musk for bringing concepts such as bitcoin into the mainstream, FinTech is no fad – it’s a broad church replete with businesses that offer varying solutions to a wide range of problems.
For Mark, it’s the real-world, problem solving nature of FinTech that deserves greater attention and awareness.
“I really hope there’s less focus on blockchain”, he laments, “and more focus on important, close-term issues that affect us”.
And despite the sector’s comparative youth, its impact has already been felt.
According to EY’s Global FinTech Adoption Index 2019, three out of four global consumers use a money transfer and payments FinTech service, and a further 56% of SMEs use a banking and payments FinTech service – but that doesn’t necessarily denote user awareness.
In this sense, FinTech often operates on a behind-the-scenes basis; we know it to have already streamlined personal banking, but the comparatively less impressive business-based statistics speak to the fact that corporate banking has yet to be similarly revolutionised.
This is where the role of education comes in.
The FinTech Lunch’s Academia panel featured Niels Pedersen, Senior Lecturer at Manchester Metropolitan University, and Professor Markos Zacharidis of the Alliance Manchester Business School.
While Niels heads up the MSc Financial Technology programme, there was an emerging consensus that creating an entirely new degree, such as BSc FinTech, wouldn’t necessarily be helpful in raising awareness.
Instead, injecting aspects of financial technology into existing courses might be the best means of educating the next generation about the benefits and necessities of FinTech.
And this doesn’t simply pertain to software engineers, either. The panel discussed the importance of so-called ‘conduits’: individuals who understand both business and technology and can form a bridge between the aforementioned disparate aspects of the sector.
Young People are the Future
And, of course, the young people in question are tomorrow’s FinTech leaders, innovators and strategists.
In order to ensure the success of FinTech and to continue to push it into the spotlight, the panellists of the Academia panel agreed that education around existing technology should start young, and that collectively we need to pinpoint the exact skills needed.
Important, too, is the fact that Generation Z are purpose driven, both as consumers and workers.
According to a 2021 survey shared by YouGov, 49% of those belonging to Gen Z would “work for a purpose-driven company for a 20% lower salary on average”, and 39% say that corporations being aggressive and visible in addressing important challenges is “very important” to their financial and employment-based decisions.
For this reason, Kate Thomas, Employer Engagement Manager at the EY Foundation, notes that “we need to think about how we recruit, where we recruit”.
Of course, this pertains not only to the diversity of solutions to be found within the FinTech sphere, but also the diversity of the sector’s workforce itself.
While Tech Nation reported in 2018 that 15% of the digital tech workforce in the UK are from BAME (Black, Asian, and minority ethnic), a new study from CandidateX showcased that “white male executives dominate the rungs of leadership, which leaves women and BAME professionals out in the cold”.
Put simply, in order to attract the most diverse range of talent from upcoming generations, existing FinTechs must spearhead progressive values both internally and externally.
As might be apparent, the FinTech lunch was largely characterised by a sense of positivity and desire to put the past 18 months behind us.
That’s certainly true of the team here at AccessPay, as we continue to expand our services and deliver effective payment automation and cash management on a global scale.
For a closer look at our middleware solution, follow the link below to view our Platform Showcase to see how you can free up your finance and treasury teams.