Round table report: What’s next for fintech and what role will AI play?

From evolving consumer expectations, and regulatory changes, to helping tackle barriers to financial inclusion, the growth of fintech has transformed the financial services market.
While some might view COVID-19 as the main catalyst behind the fintech boom, the emergence of fintech can actually be traced much further back to the early 2000s.
The launch of the first iPhone in 2007 was closely followed by the global financial crisis of 2008. With consumer trust at an all time low, and the industry facing some big questions around how such a catastrophic event could have been allowed to happen, a major opportunity opened up for fintech start-ups.
Our panel was:
● Shaun Beebe, commercialisation partner for inclusive financial technologies, University of Nottingham.
● Vangelis Tsiligkiris, professor of international education, Nottingham Business School (NBS)
● Solomon Y Deku, senior lecturer in finance, Nottingham Trent University.
● Jim Devlin, adjunct professor, Dept of Economics and Finance, University of the Free State, South Africa and professor emeritus at Nottingham Trent University.
● Hilary Smyth-Allen, chief executive of SuperTech West Midlands.
● Jof Walters, CEO Greater Things.
● Libby James, co-founder, Merchant Advice Service.
The roundtable hosted in partnership with digital marketing and PR agency, Tank, kicked off by exploring the role of the 2008 crash and its impact on consumer trust.
Jim Devlin, Adjunct Professor, Dept of Economics and Finance, University of the Free State, South Africa and Professor Emeritus at Nottingham Trent University, discussed a research project he was working on at the time, focused on the topic of trust across financial services. Jim said: “Before 2008, banks were never really setting the world alight, they were all in a pack and when compared to other financial services institutions our research found that banks actually lagged behind. When new banks came along, they offered something new and shiny and that was an attractive proposition for consumers.”
When exploring the role of the regulator in allowing fintech to thrive, Vangelis Tsiligkiris, Professor of International Education, Nottingham Business School (NBS) emphasised how, post-2008, there was a drive from regulators to do things differently: “The first was to heavily regulate the banks and avoid similar problems happening in the future… Then at the same time they deregulated part of the industry that allowed fintechs to scale.”
Vangelis went on to highlight how the growth of fintech can be closely linked to the internet boom and the scaling of technologies like big data and machine learning: “These are the foundations of most fintech models. So what you see now is a reflection of these various developments.”
The conditions across financial services in 2008 undeniably facilitated innovation, with Solomon Y Deku, Senior Lecturer in Finance, Nottingham Trent University, describing how, at the time: “a lot of talent moved from the traditional banking sector and went on to use their skills to pioneer the development of new products. These people had previously worked in a sector that was curtailed by regulation.”
When asked about whether or not the UK is a global fintech capital and if a lot of this activity is concentrated in London, Hilary Smyth-Allen, Chief Executive and SuperTech West Midlands, argued that: “There are many prizes to be won across the UK and Fintech shouldn’t just be seen as a London-centric thing… fintech is a national pursuit, and there are already hubs in Birmingham, Scotland and the Pennines.”
Shaun Beebe, Commercialisation Partner for Inclusive Financial Technologies, University of Nottingham emphasised that there are big opportunities for fintech outside of London: “There’s a big opportunity for places like Nottingham that already have large financial services sectors to become hubs for new start-ups and spin-offs. This will also create great jobs and wealth within the region, offering high paid and skilled jobs. You have to get people to want to buy into it and feel inspired.”
Jof Walters, CEO Greater Things, went to highlight the likely impact of the cost of technology dropping and how it could lead to more fintech start-ups and scale-ups: “Building a bank back in 2014, you had to have millions to get into the market. You now have fintechs being built out of someone’s bedroom. I predict we’ll therefore start to see the growth of micro-fintechs or SME fintechs, and that’s really exciting.”
The discussion concluded on the topic of what is still needed to fuel future innovation and growth, with Libby James, Co-Founder, Merchant Advice Service, believing that: “Speed is absolutely key as we’re operating in an industry that is changing dramatically and new offerings are emerging almost every five minutes.”
Read a full summary of the discussion here.