What will PM Sunak do for UK fintech?
Rishi Sunak is now prime minister, taking over from Liz Truss after her disastrous 45-day residency at 10 Downing Street.
The former chancellor is well known to peer-to-peer lenders as the architect of government-backed lending schemes such as the bounce back loan scheme and the coronavirus business interruption loan scheme. Approximately £78bn was loaned to UK businesses through these schemes, via mainstream lenders and P2P platforms such as Assetz Capital.
Sunak (pictured) has also indicated that he is a fan of the fintech sector. Last year, he spoke at Fintech Week and used the opportunity to announce a raft of new initiatives to support the fintech sector. These included creating the Financial Conduct Authority ‘scale box’; starting work on a Centre for Finance, Innovation and Technology; and assembling a taskforce to look into a digital centralised currency.
In fact, Sunak has long been a crypto evangelist, repeatedly stating that he wants the UK to become a global crypto hub. His understanding of cryptoassets will be seen by many fintech insiders as a positive sign. The development of crypto infrastructure has been hindered by a lack of appropriate regulation, resulting in some high-profile fraud cases which have spooked the City watchdog. A pro-fintech prime minister could have a reassuring effect on the general public as well as the regulators.
Sunak’s years studying at Stanford University, in the heart of Silicon Valley, also add to his tech and fintech-friendly credentials.
Back in 2021, he told technology magazine Sifted that he wanted the government to adopt the start-up mindset. “We want to move quickly, be highly consumer-orientated and do things that scale with impact,” he said. “We want to do things that are technology-centric as that’s how people are living their lives. So hopefully we can have that ‘startup Treasury’ mindset.”
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Certainly, the tech community has welcomed the potential of the Sunak administration.
“As we welcome Rishi Sunak’s arrival to number 10, we look forward to the continuation of his pledge to make the UK a science and technology “superpower” and to ensure a strong pipeline of government backing is available to the most exciting and fastest growing scale-up businesses as the engine room of growth, exports, and employment for the UK,” said Tech Nation chair Stephen Kelly, following Sunak’s appointment.
“We welcome the formulation of a robust strategy from the government to continue building a vibrant ecosystem to boost our home-grown tech talent and companies.”
During his two year tenure as chancellor, Sunak made many promises to the fintech community. If he keeps his word, we will likely see the relaxation of work visa schemes, the creation of a government-backed stablecoin, and a generous package of funding for fintech scale-ups.
Just 18 months ago Sunak described fintech as “one of the UK’s great success stories [that] will help us seize new opportunities around the world.”
“We must now build on our global reputation for fostering innovative start-ups and ensure firms can access the talent, finance and support they need to scale up here in the UK,” he added.
If PM Sunak can build on the momentum of Chancellor Sunak, his premiership could be transformative for UK fintech, including P2P lenders and crypto-backed lenders.
Amid a particularly challenging economic environment, funding may be tight. Nonetheless, simply by speaking out about the benefits of fintech lending and demystifying concepts such as crypto investing, Sunak could become the most valuable cheerleader of the sector, without spending a single crypto-penny.
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