The Kalifa Review of UK FinTech

On 26 February 2021, HM Treasury published an independent report on the UK Fintech sector by Ron Kalifa OBE.  At the Budget 2020, the Chancellor asked Ron Kalifa OBE to conduct an independent review to identify priority areas to support the UK’s fintech sector. The Review formally launched in July 2020 with objectives for supporting the growth and widespread adoption of UK Fintech, and for maintaining the UK’s global Fintech reputation.

The Kalifa Review of UK Fintech highlights the opportunity to create highly skilled jobs across the UK, boost trade, and extend the UK’s competitive edge over other leading fintech hubs. It sets out a series of proposals for how the UK can build on its existing strengths, create the right framework for continued innovation, and support UK firms to scale.

The report’s recommendations are contained in a 5-point plan:

  1. Policy and Regulation
  • Deliver a digital finance package that creates a new regulatory framework for emerging technology
  • Implement a “Scalebox” that supports firms focusing on scaling innovative technology
  • Establish a Digital Economy Taskforce (DET) to ensure alignment across government
  • Ensure that fintech forms an integral part of trade policy
  1. Skills
  • Retrain and upskill adults in support of UK fintech by ensuring access to short courses from

high-quality education providers at low cost

  • Create a new visa Stream to enhance access to Global Talent for Fintech scaleups
  • Build a pipeline of fintech talent by supporting fintech scaleups to offer embedded work placements to Further Education and Higher Education students and Kickstarters
  1. Investment
  • Expand R&D tax credits, Enterprise Investment Scheme and Venture Capital Trusts
  • Unlock institutional capital to create a £1bn “Fintech Growth Fund” of sufficient scale to act as the catalyst in developing a world leading ecosystem
  • Improve the listing environment through free float reduction, dual class shares and relaxation of pre-emption rights
  • Create a global family of fintech indices to enhance sector visibility
  1. International
  • Deliver an international action plan for fintech
  • Launch an international “Fintech Credential Portfolio” (FCP) to support

international credibility and increase ease of doing business

  • Drive international collaboration through the Centre for Finance, Innovation and Technology,

and launch an International Fintech Taskforce

  1. National connectivity
  • Nurture the high growth potential of the top 10 Fintech clusters
  • Drive national coordination strategy through Centre for Finance, Innovation and Technology
  • Accelerate the development and growth of Fintech clusters through further investment, such as in R&D

HMT is expected to publish a response in due course. Mr Kalifa has also requested the UK Government to consider appointing a FinTech ‘business champion’ to support FinTech and deliver the strategy set out in the Kalifa Review.

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/965687/KalifaReviewofUKFintech.pdf

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/965034/KalifaFintechReview_Exec_Summary.pdf