What will Prime Minister Sunak do for fintech in the UK?
Rishi Sunak is now Prime Minister, taking over from Liz Truss after her disastrous 45-day stint in Downing Street on 10
The former chancellor is well known to peer-to-peer lenders as the architect behind state-backed lending schemes such as the return loan scheme and the coronavirus business interruption loan scheme. Around £78bn was lent 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 number of new initiatives to support the fintech sector. These included creating the “scale box” from the Financial Conduct Authority; start work on a center for finance, innovation and technology; and putting together a working group to look at a digital centralized currency.
In fact, Sunak has long been a crypto evangelist, and has repeatedly stated 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 hampered by a lack of appropriate regulation, resulting in some high-profile fraud cases that have alarmed City Watchdog. A pro-fintech prime minister can have a reassuring effect on the public as well as regulators.
Sunak’s years of study at Stanford University, in the heart of Silicon Valley, also add to his tech and fintech-friendly credentials.
Back in 2021, he told the technology magazine The charge that he wanted the government to adopt the start-up approach. “We want to move fast, be very consumer-centric and do things that scale with impact,” he said. “We want to do things that are tech-centric, because that’s how people live their lives. So hopefully we can have that ‘startup Treasury’ mindset.”
Read more: FCA to investigate the impact of Big Tech
The tech community has certainly welcomed the potential of the Sunak administration.
“As we welcome Rishi Sunak’s arrival at Number 10, we look forward to continuing his promise to make the UK a science and technology ‘superpower’ and to ensuring a strong pipeline of government support is available in the most exciting and fastest growing scale – up businesses as the engine room for growth, exports and employment for the UK, said Tech Nation chief Stephen Kelly, following Sunak’s appointment.
“We welcome the formulation of a robust strategy by the government to continue to build a vibrant ecosystem to grow our home-grown technology talent and businesses.”
During his two-year term as chancellor, Sunak made many promises to the fintech community. If he keeps his word, we are likely to see the relaxation of work visa regulations, the creation of a government-backed stablecoin and a generous package of funding for fintech scale-up.
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 now need to build on our global reputation for promoting innovative start-ups and ensure firms can access the talent, funding and support they need to scale up here in the UK,” he added.
If Prime Minister Sunak can build on the momentum of Chancellor Sunak, his premiership could be transformative for UK fintech, including P2P lenders and crypto-backed lenders.
In the midst of a particularly challenging economic environment, funding can be tight. Yet, simply by speaking out about the benefits of fintech lending and demystifying concepts like crypto investing, Sunak could become the most valuable cheerleader in the sector, without spending a single crypto penny.
Read more: Funding Circle and Zopa urge the Chancellor to support the fintech sector
