Marca Wosoba, Head of International Development at World First
Last month Theresa May outlined her vision for a ‘global Britain’ in her first Brexit speech since the UK voted to leave the EU. Her commitment to keeping the country ‘open for business’ was music to the ears of the fintech industry and rightly recognised as a positive first step prior to Article 50 being triggered in March.
But why were the fintech industry buoyed by May’s words and commitment? Because, according to Innovate Finance, 30% of people employed within the UK fintech industry come from overseas, making the sector more reliant on foreign staff than the wider financial services industry as a whole.
What’s more, having access to a global talent network is important to encourage growth and innovation, as I’m sure senior management at fintech companies across the country would attest. Simply put, why turn your back on a wider pool of ideas, creative thinking, expertise and experience if you don’t have to?
So we can see why the initial noises coming from Number 10 about an outward looking Britain post-Brexit are so welcome.
However, building upon these early foundations, it will be important that the government considers some of the following practical initiatives. These steps will help ensure the UK remains a global bastion of fintech, thereby dispelling any notion of a ‘techxit’.
Working visas currently only last for a maximum of three years, making it difficult for some companies to realise a return on their investment in people. This is particularly true for start-ups in the growth phase and can often prove an obstacle to development in the sector.
By increasing visa lengths to five years the government would support companies presently unable to make a business case for hiring the international talent they need to grow, as well as making the UK a more appealing destination to those with the skillsets we want to attract from overseas.
Tech Nation visa costs
The Tech Nation visa scheme, a UK based programme to help businesses attract and secure world-class talent from outside the EU, is a powerful incentive for skilled individuals looking to work in the UK tech market.
At present, the percentage of non-EU based EMEA visa applicants accounts for 28% of the total number of people applying for the scheme. However, depending on the UK’s access to the EU talent pool post-Brexit, the fintech sector may become more dependent on the Tech City scheme to help attract international workers from the continent.
By decreasing the cost of the scheme the government would further demonstrate its desire to remain a destination for overseas talent and make it more attractive for those considering a move abroad.
Fast-track application process
Applying for a working visa can sometimes be a long, complex process which holds back businesses who need to bring in talent at short notice.
Often companies will identify a niche in the market to launch a particular product or service, but lack the skillset required to do so immediately. In order to capitalise on the opportunity in a timely manner it is often more efficient to hire someone from overseas who already possesses the skills needed, rather than attempting to craft them internally.
By fast-tracking the process for Tier one and Tier two visas in certain circumstances the government will ensure that companies are not disadvantaged by lengthy immigration procedures and are supported throughout a variety of situations.
Whilst it is important that the UK remain a global player within the fintech industry, the government must also look to initiatives that can help support home-grown talent too.
The idea of visa reciprocity would enable such development by offering a new type of tech visa or exemption for fintech businesses in exchange for a commitment to hiring UK apprentices. The degree of reciprocity could be determined by the size of the company, with businesses required to employ more apprentices relative to the number of tech visas granted.
Not only would this ensure the fintech sector has access to the international talent it needs to continue to grow, but it would also improve the knowledge and skillset of the local workforce to help maintain an even balance of foreign and home-grown employees.
Developing a strong pool of local talent is key to ensuring the UK maintains a competitive edge over other international fintech markets. Not only will this sustain current businesses in the sector, but it will also create a pipeline for future development and growth in the long term.
The role of education
At a grassroots level, the government should work with education providers to give students early exposure to the fintech sector and develop a working understanding of the industry.
For example, the Hong Kong government currently runs a scheme alongside a number of higher education institutions in the country which coordinates placements for its students in fintech companies, banks and regulatory authorities. The Fintech Career Accelerator Scheme (FCAS) is run by the Hong Kong Monetary Authority (HKMA) and the Hong Kong Applied Science and Technology Research Institute (ASTRI) to expand the talent pool for the development of the fintech sector in the country.
The placements enable students to develop relevant skills through real experience and provide employers with the opportunity to recruit fresh, home-grown talent. The government should also work with the sector to actively promote the industry to boost interest and understanding within the UK.
Fintech is still a relatively new sector and more needs to be done to promote careers in the industry and highlight the opportunities available to British students after their studies. Proactive campaigns to target students across the country will help attract top UK talent and create a solid home-grown base and pipeline within the sector.
Finding the balance
The financial services sector remains one of the most important industries in Britain, directly employing 2.2 million people across the country. As we approach a post-Brexit reality it is important that the government continues to support the fintech ecosystem in the UK.
Strong infrastructure, a reliable regulatory environment and access to sound capital and talent all play a role in maintaining the UK’s position as an international fintech leader. However, whilst it is important to continue to nurture the existing talent we have within our own borders, it is also vital that we retain access to international talent to enable the fintech sector to continue to grow.
Finding a balance between the two will be achieved by fintech firms playing an active role feeding into industry consultations and working closely with the government as they negotiate the best deal for the UK when leaving the EU later this year.
As a sector we must find solutions to overcome challenges at a local level whilst continuing to think internationally in order to maintain our position at the forefront of the global fintech industry.