In March 2022, FinTech Scotland, the independent cluster body, published a strategic FinTech Research and Innovation Roadmap, identifying industry priorities for the UK to accelerate its fintech ambition through research and development (R&D) and targeted innovation.

The roadmap was developed in close coordination with fintech entrepreneurs, the financial services sector, academia, regulators, Government bodies and consumer groups, and provides a pathway and action-oriented framework to increase the positive impact of FinTech Innovation across Scotland and the UK.

The roadmap also supports the recommendation in the Kalifa Review of UK Fintech, for increased R&D investment in fintech innovation to accelerate fintech cluster excellence, and was positively welcomed by Ron Kalifa, the financial services sector, UK and Scottish Government and the City of London Corporation.

The priorities laid out in the Roadmap centred on four strategic innovation themes:

• Climate Finance
• Open Finance Data
• Payments and Transactions; and
• Financial Regulation

Over a ten-year period, the ambition is to significantly increase fintech related jobs across Scotland and the UK, as well as produce an increase in economic gross value add (GVA) through fintech innovation.

One year on, industry-led collaborations have driven growing action against each of the strategic innovation themes. These collaborations, at the cutting edge of innovation, are driving results. Examples include:

• Climate Finance

  • 100% increase in fintech enterprises in Scotland focused on climate finance
  • Accelerated fintech partnerships and fintech adoption through new innovation labs launched with Lloyds Banking Group and TSB with outcomes helping UK customers towards carbon efficiency
  • Climate finance enabled through cross-sector collaboration with Space Scotland, accelerating innovations in ESG using data from satellite sources

• Open Finance Data

  • 26% increase in fintech enterprises developing innovative solutions using Open Banking.
  • Accelerated fintech adoption and creation of commercial opportunities through the launch of Phoenix’s innovation forum to build greater engagement and support the well-being of its customers, driving forward greater financial inclusion.
  • The Smart Data Foundry’s research on vulnerability in the pension market, the impact of late payments on the SME market, and on the net zero agenda, all enabled through Open Finance Data.

• Payments & Transactions

  • 19% increase in fintech enterprises in Scotland developing payment solutions.
  • Investment of £94 million into fintech enterprises focused on payment innovation in the last 12 months.
  • Development of Cryptofinance, blockchain and Distributed ledger courses at leading Scottish universities.

• Financial regulation

  • 13% increase in fintech enterprises specialising financial regulation innovation.
  • Investment of £83m into fintech enterprises focused on financial regulation innovation in the last 12 months.
  • Confirmed government and industry support to accelerate innovation in financial regulation enabling the creation of the Financial Regulation Innovation Lab.

Nicola Anderson

Nicola Anderson, CEO of FinTech Scotland, said: “By enabling collaborative innovation across the fintech ecosystem not just in Scotland but the whole of the UK and beyond, we can see how the FinTech Research and Innovation Roadmap is already making a real difference — helping businesses to build economic growth, create jobs, work through climate finance to enable a future net zero economy, and helping to alleviate the cost of living crisis.

“The FinTech R&I Roadmap demonstrates how collaboration and innovation can change people’s lives, driving positive outcomes for both business and citizens both in Scotland and across the UK.”

Jane Martin, managing director of innovation and investment at Scottish Enterprise, said: “Strong, effective and purposeful collaboration between industry, academia and the public sector is key to delivering much needed innovation and growth for Scotland.

“The FinTech Research and Innovation Roadmap is a demonstration of how collaborative action through purposeful strategic action can drive good economic outcomes and accelerate future growth.”

Catherine Martin, vice principal corporate services at the University of Edinburgh, said: “As a founding partner of FinTech Scotland the University of Edinburgh is fully committed to the role R&D plays in developing fintech economic opportunities in Scotland and across the UK.

“Our experience and academic excellence in both disruptive technologies and other sectors has shown how strategic and purposeful partnerships can shape the future direction of vital industries and sectors in our economy and society.

“We’re committed to playing our role as a leader and as a collaborator in fintech and financial services innovation, pushing forward the FinTech Research and Innovation Roadmap priorities”.

Eleanor Shaw, associate principal at the University of Strathclyde, said: “Strathclyde is proud of its role in shaping the future of fintech. It was one of the first universities to launch an MSc in fintech in the UK.

“Very early on we understood the importance of financial innovation to re-invent a sector that was built to benefit the many, not the few. R&D is key and the Roadmap is a fundamental tool.

“It’s been a key component in advancing our fintech strategy at Strathclyde. As a result we’re working in collaboration with FinTech Scotland, the University of Glasgow and the industry to establish the Financial Regulation Innovation Lab, to advance innovation in financial regulation.”

Frank Gauld

Frank Gauld, CEO at Smart Data Foundry, who sponsored the Roadmap, said: “When it comes to data and innovation, the potential is exciting and unlimited. The FinTech R&I Roadmap focuses the mind and provides a clear industry view on innovation priorities.

“In the last year we’ve worked closely with FinTech Scotland, progressing research and innovation to unlock the power of financial data to improve people’s lives across society, the economy and the environment.

“Examples include our work with the FCA to innovate in the area of APP Fraud, research on consumer vulnerability in the pension market, the impact of late payments on the SME market, and working with Bankers for Net Zero to support the initiative to transition to a zero carbon economy.

“The insights are used across the industry and by regulators to change outcomes for people and businesses for the better”.