FinTech Scotland has scored a significant coup in terms of funding. According to a June 26, 2020 report, the organization will receive £22.5 million in funding. The funding will be used to open the Global Open Finance Centre of Excellence (GOFCoE).
FinTech in Scotland Gets a Boost
The center in question will be opened in the Central region as well as Edinburgh. Once opened, it will be dedicated to the research and development of innovative solutions using financial data. Participants from all over the world will be able to use the center.
This news was formally confirmed by the UK Research and Innovation, a Government research funding agency. The grant is being given from the Strength in Places Fund, which aims to support innovation and economic growth. FinTech Scotland is not the only recipient as a total of seven proposals received funding.
An example of the work that will be done at the center is a study on public earning, saving, and spending. The benefit of this is that public enterprises will be able to create services and products that are tailored to public needs. Furthermore, policymakers will have a better idea of the implications of various regulations on the public before they are implemented.
FinTech Scotland has been in development for around two years, according to the report. In that time, it has received support from the University of Edinburgh, FinTech Scotland, the Financial Data and Technology Association (FDATA), and Scottish Enterprise. Stephen Ingledew, the Chief Executive of FinTech Scotland, said that this support would enable the organization to continue to support the fintech cluster in the country.
The benefits that the center will afford was reaffirmed by Ivan McKee, the minister for Trade, Investment, and Innovation. In his statement, he said that the center will help unlock the benefits of open banking. Furthermore, it will help to enhance the position of Scotland as a destination for fintech.
Fintech Staying Afloat Amidst COVID-19 and Beyond
While this development means a great deal for the fintech industry within Scotland, globally fintech is trying to stay afloat. This is because of the ongoing COVID-19 pandemic. While businesses all over the world have been affected, the fintech industry has been hit in a unique way.
On one hand, investment opportunities have been lost due to the virus. The global slowdown of business means that investors are less open to investing in innovative technologies. In the UK, it is estimated that the industry has lost £1.7 billion because of the current situation.
The virus is not the only factor, however. Poor equity management has also been cited as a reason for firms missing out on opportunities. According to a study carried out by Qadre in conjunction with techUK, 32% of fintech firms report losing opportunities due to their equity management practices.
At the same time, fintech could find itself playing a significant role in the world’s recovery from the outbreak. Fintech companies are, by nature, very adaptable. As people were forced to adjust to life with social distancing, carrying out financial transactions became more difficult.
Thanks to fintech firms, people can access the services they need such as online lending and wage advances. This means that funds can be kept in circulation which aids the economy and people can complete their transactions with ease. Only time will tell, however, if the increased fintech integration will remain following the return of life to normal.
What do you think of the grant to FinTech Scotland? Will the country become a major player in fintech? Let us know your thoughts below.