Midlands financial services sector growing in optimism – Deloitte

FINANCE industry leaders in the Midlands are optimistic for the continued growth of the region’s financial services sector despite the threat of emerging ‘FinTech’ and non-traditional financial services firms.

That is one of the key finding of accountancy and advisory firm Deloitte’s annual Midlands Financial Services Survey.

Three-quarters (75%) of respondents to the survey said they expect their business to perform better in the next three months than in the last, the same proportion as 12 months ago.

However, one-in-five (20%) anticipate their firm will do ‘much better’, a slight reduction on last year’s results (23%).

Although levels of confidence remain high, respondents are preparing for increased competition from FinTech and non-traditional financial services firms, such as Google and Apple.

The vast majority of respondents (85%) expect the marketplace to become more competitive with one-in-five (19%) anticipating a significant impact on their business from such organisations.

More than half of respondents (57%) feel they are ‘somewhat prepared’ for the rise in consumer preferences for undertaking financial transactions through digital and online means, while one-in-five (22%) said they are ‘somewhat underprepared’.

Respondents were also asked about their views on when interest rates are likely to rise with the largest proportion (43%) expecting a rise in March or April 2016.

Matt Perkins, head of financial services for Deloitte in the Midlands, said: “Challenges for financial organisations abound, but there are strong grounds for optimism with an improving economy and a gradual rise in interest rates likely to benefit many in the sector.

“However, with more and more non-traditional financial services firms entering into retail financial services and continued regulatory change, organisations are having to invest in and adapt to an evolving competitive landscape.”