Regional FinTech developments in the UK

In the first of a two-part blog series, Whitecap Consulting’s Julian Wells shares some insights on the evolving regional FinTech landscape forming in the UK.

Over the last 12 months there has been a marked increase in the level of interest from policymakers and business leaders in the regional FinTech economy outside London, both domestically and internationally.

As a regional strategy consulting firm active in the FinTech sector, we’ve been watching with interest. In fact, we’ve been doing a lot more than watching, as so far in 2018 we’ve been involved in FinTech projects and / or events in Leeds, Manchester, Liverpool, Glasgow, Edinburgh, Bristol, Milton Keynes, and of course London, dealing with a range of UK and international organisations.

After a flurry of activity in the first half of the year, which for Whitecap included hosting nine FinTech North events, this seems like a good time to share some reflections on the evolving regional landscape.

Developments originating from London

There was a significant development in regional FinTech in March when the Treasury announced the appointment of three new FinTech Envoys, giving it a total of six operating around the UK, including representatives for Scotland, Wales, Northern Ireland, and the Northern Powerhouse.

The announcement of the new FinTech Envoys was made during UK FinTech Week, a week which also saw the annual Innovate Finance Global Summit (IFGS) take place. This year, for the first time, the agenda featured sessions focused on regional FinTech. There were two sessions, both of which Whitecap and FinTech North were delighted to chair, with representatives from Leeds, Manchester, Liverpool, Birmingham, Scotland and Wales were amongst the participants.

The increasing regional focus of Tech Nation

More recently, London-based Tech Nation has commenced a tour of 11 regional cities in the UK, with FinTech high on the agenda, not least via the call for applications from across the UK for its early stage FinTech programme. Tech Nation’s FinTech Lead Greg Michel has been leading the charge on the regional focus, and recently spoke at a FinTech North seminar in Leeds in June.

Tech Nation has also recently published a 4 part podcast series in partnership with 11FS, entitled ‘One FinTech Nation’, with one episode dedicated to a debate around ‘bursting the London FinTech bubble, including contributions from long time regional FinTech advocate Chris Sier, who is also the Treasury’s FinTech Envoy to the North and has chaired multiple FinTech North conferences over the last three years.

Towards the end of last year the FCA made a series of visits to regional cities, hosting roundtable discussions with key stakeholders in each, and also holding individual meetings with local FinTechs. The regulator has expressed its commitment to continuing to support the regional FinTech economy, although the majority of firms accepted into its Sandbox in the first four cohorts have been London-based, which illustrates the relatively marginal role the regions currently play in the UK’s FinTech innovation pipeline. It’s certainly an area where we can strive for improvement.

The FCA’s Christopher Woolard and Anna Wallace spoke at the Manchester and Leeds FinTech North conferences this year and reaffirmed the regulator’s commitment to regional FinTech.

Developments within the regions

It has been very promising to hear positive noises coming from policymakers and others in London about regional FinTech, but there can be no doubt that the key to the prosperity of the regions lies within the regions themselves.

In this respect, the north and Scotland seem to have been particularly active and account for the location and / or primary focus of three of the Treasury’s five FinTech Envoys (Chris Sier, David Duffy, David Ferguson).

In the Northern Powerhouse, Leeds, Manchester, Liverpool, and Newcastle are the main FinTech hubs, although Sheffield has a thriving digital scene which includes U Account and others.

The growth of FinTech North

FinTech North, the events-based initiative Whitecap co-founded with White Label Crowdfunding in 2016, has expanded from being a Leeds-based entity into a series of conferences across Leeds, Manchester and Liverpool with further events planned in Sheffield, Harrogate and Newcastle this year. FinTech North has now organised 18 events, attracting over 1800 delegate registrations from over 400 different companies, with speakers drawn from more than 12 countries. FinTech North’s story so far.

DIT FinTech trade missions

In November last year, the Department for International Trade hosted a Nordic-Baltic delegation of 20 scale-up FinTech firms who spent time in Manchester and Leeds as part of a Northern Powerhouse FinTech Mission. They met representatives of the region’s major Financial Services brands, professional services firms and investors, resulting in a number of further visits and, for some, taking the decision to establish a base in a northern city. The north also welcomed DIT visitors from Latin America, and USA and It seems we can expect to see more of these northern-focused delegations in the near future. Indeed FinTech delegations from the Nordic-Baltic countries and Western Europe are already scheduled to visit the north later in 2018 and early in 2019 respectively.

The impact of FinTech Scotland

North of the border we have seen the launch of government-backed FinTech Scotland, and the appointment of a full time CEO in Stephen Ingledew, followed by the announcement of an advisory board and its first chairman, David Ferguson of Nucleus, who is one of the aforementioned FinTech Envoys. FinTech Scotland has also now announced its executive board and continues to make impressive progress in showcasing the Scottish FinTech scene on a national and international basis.  Stephen Ingeldew’s fortnightly FinTech Fuse blog posts are a great way to keep up to speed with developments north of the border.

South West & Wales

Activity in other regions currently seems to be more sporadic, as far as we are aware. Bristol & Wales look to be areas to keep an eye on. Bristol FinTech (shortly to rebrand to FinTech West) is an organisation we are increasingly familiar with at Whitecap, not least as we are shortly to establish an office presence in the city.

Meanwhile in Wales the appointment of FinTech Envoy Richard Theo, CEO of Wealthify, has helped raise the profile of activities in the region where Business Wales has also long been banging the drum and representing Wales at various FinTech events.

A bright future of UK FinTech

Clearly there’s an increasingly amount of regional FinTech activity and this can only have a positive impact on the overall UK FinTech economy. According to PitchBook, in 2017 the UK was second only to the USA in the levels of FinTech investment. With an enhanced and expanded FinTech sector across the UK we can expect to see ongoing growth and prosperity.

There are also a number of trends emerging in regional FinTech, and we will explore these in the second part of this blog, to be published over the next few days.

Whitecap Consulting are specialists in providing strategy, marketing and commercial consultancy. Read more about us