Agenda item

The Chairman welcomed Charlotte Crosswell OBE of Open Banking and the Centre for Finance, Innovation and Technology (CFIT).

Ms Crosswell spoke of her work with Innovate Finance and meeting with the Court of Aldermen at this time to try and bridge the gap between industry bodies and the Corporation as an investor. She underlined that she was keen to re-establish these relationships under CFIT which had been incorporated as of 10 days ago and had appointed a CEO who would join the company in April 2023. 

Ms Crosswell went on to talk of how CFIT came into being and how this would work alongside the City Corporation. It was reported that CFIT had been born from the Independent Kalifa Review of UK FinTech. Innovate Finance and the Corporation had acted as co-secretariat for this. Whilst the start of the review had been delayed by approximately 6 months as a result of the General Election and then the outbreak of COVID, it had lasted for a total of 9 months and included over 300 stakeholders across a wide range of the ecosystem – financial institutions, FinTechs, academics, regulators, Government Departments and others. The Review had bridged different chapters – Skills and Talent, Investment, Regulation and Policy, National Connectivity and International Connectivity. The Committee were informed that there are 27 associations/bodies representing FinTech across the UK. However, three of the Chapters of the Review had concluded that another body was needed to serve as a means by which Government, regulators and industry could meet to solve issues such as the skills and talent gap. This was therefore the genesis for CFIT.

Ms Crosswell explained that CFIT was a virtual centre, working across key hubs across the country as opposed to being another London quango. It was reported that CFIT had gone through a Steering Group initially chaired by Sir Ron Kalifa before Ms Crosswell had taken over the Chair as of January 2023. The aim was to now launch CFIT on 28^th February 2023 with the launch due to take place in Leeds – another big city in terms of FinTech. There would also be a celebratory reception event held in the Guildhall later this same week.

Ms Crosswell set out that CFIT existed to ensure that the UK was the global leader for financial innovation, to accelerate opportunities and unblock barriers to growth, financial technology and bring together the best minds from the ecosystem. Importantly, it would seek to drive better outcomes for consumers and SMEs across the UK. The Committee were informed that CFIT would work on time limited coalitions of experts from both finance and technology ecosystems and these would be addressing the barriers to FinTech sector growth. These coalitions in the Review had centred on Open Finance, SME Finance and Digital ID. CFIT would work very closely with the industry bodies to ensure input from their memberships. CFIT would also focus on skills and talent focusing primarily, in the short-term, on student placements and bringing new people into the sector.

CFIT would announce the first coalition in April 2023 during UK FinTech week and intended to make further announcements as to student placements and regional connectivity at the launch event.

The Chairman thanked Ms Crosswell for her contribution and kicked off questions by questioning how CFIT intended to link in Green Tech and also digital currency. Mr Crosswell stated that it was important to know what work was being done by other industry bodies and for CFIT to fit in in terms of this wider agenda. She recognised that Green Tech had incredible support from the Corporation and across the country and stated that she would be working closely alongside the Green Finance Institute (GFI) to collaborate and cooperate on their work where needed or indeed to signpost their work.

Ms Crosswell reported that this work was Treasury funded in addition to the funds put forward by the City Corporation. She added that all Government Departments would be picking up on various workstreams.

An Alderman questioned, given there were so many organisations operating in this space, what success might look like for CFIT and how the Court of Aldermen specifically could support this. Ms Crosswell responded to state that success for her would be based on outcomes predominantly for consumers and SMEs as well as bringing in the large financial institutions. Whilst there would appear to be a relatively slim mission on the proposed skills and talent piece, Ms Crosswell emphasised that she felt it was important to show what the FinTech sector could do and how Financial Services across the country were innovating. She was hopeful that some tangible outcomes could be reported this time next year showing that the coalitions had been started and was really delivering in terms of results. In terms of help from the Court of Aldermen, Ms Crosswell stated that it was really important that all stakeholders understood what CFIT was and pointed to where others may wish to engage with them. Further messaging around this would be issued with a view to the Court then further disseminating this. Once the first coalition had been established further conversations would be had in terms of who the City Corporation might like to see represented or linked in here.

Another Alderman praised the aims of CFIT in terms of not overreaching and being focused. She commented on the funding already secured and questioned who might fund this work in the longer-term in the absence of a membership as such and in this relatively crowded space. Ms Crosswell reported that thought had already been given as to how this might look in three year’s time in terms of funding. She stated that she saw this as much more of a partnership association/collaborations and that future funding might be sought for specific coalitions from philanthropic or private sector organisations post these first three years. It was reported that various taskforces were being looked at across financial services and that they had already been in touch with CFIT and were interested in them potentially picking up this work which it was envisaged these organisations would fund.

An Alderman noted that CFIT was being touted as an action orientated convener, bringing together the Government, finance and the private sector. She questioned how best to ensure that relationships with other UK Financial Centres were leveraged to ensure that this was not City-centric. Ms Crosswell underlined that this was incredibly important to her and underlined that CFIT had already been liaising with FinTech North and FinTech Scotland on their forthcoming Leeds launch event. She stated that it was incredibly important to showcase what financial services and financial innovation did for the UK and for employment. She went on to reference the number of FinTech courses at key Universities across the UK including Newcastle, Leeds, Manchester, Birmingham, Wales, Bristol, Strathclyde, Edinburgh and Glasgow. There was therefore also an opportunity to collaborate here in terms of attracting students to work in financial innovation. Ms Crosswell commented that it would be nice to see senior management moving into some of those key cities too, with companies starting here, leveraging this talent pool and remaining in these centre to contribute to the local economy. Ms Crosswell reported that she was also already holding discussions with some of the large corporates based in these regions who were all keen to talk about embedded finance and how they interact with the centre. She recognised that some of the ‘early wins’ may be in terms of what CFIT could do to showcase what was already happening within other regions. Regional engagement and broad representation would be key in terms of the work of the coalitions.

An Alderman stated that he was a member of the Academic Teaching Staff at the LSE and praised CFITs reference to the need to work alongside universities and academics in this space. He went on to question whether there were any structural mechanisms within the organisation to ensure it remained regional as opposed to ultimately tilting back to London. Ms Crosswell stated that her and the CEO elect well recognised the need for all types of diversity – regional, socioeconomic, ethnicity, gender and others. Job specifications had not yet been issued but this would all be taken into account in terms of recruitment. The partnerships that CFIT were looking to announce would also have a regional focus to them.

Another Alderman referred to the number of businesses now reclassifying themselves as FinTech and the 27 other bodies, many of which had people involved that had attached themselves to the ‘FinTech bandwagon’. He recognised that the challenge here would be impact and questioned how the City could ensure that the right people were engaged to help make CFIT a success and really drive the industry forward. Ms Crosswell referred to CFIT’s recent CEO hire, stating that t would have been easy to bring someone in from an industry body but instead they had chosen to engage someone who had started up multiple companies and was a coder/’techie’ at heart who had driven through some significant change and investment. She fully appreciated and endorsed the need for the work of CFIT to be focused on action and reported that the CEO elect was extremely keen to have the technology, the data, the action plan and the reporting in place with a strong governance overlay. Ms Crosswell added that the coalitions would be very much determined on outcomes and being able to demonstrate, this time net year, that CFIT had been able to achieve something that hadn’t been done before and drive through significant change.

Finally, an Alderman spoke further on the coalitions referred to and sought further information as to how these would work. She also expressed an interest in student placements and collaborations with universities stating that she was a Professor in Practice in Economics and Finance at Durham University. She queried how student placements and work with universities would operate alongside the proposed coalitions. Ms Crosswell stated that CFIT had adopted the GFI model on coalitions and had examined lessons learnt by them in the process of establishing these. Essentially, this would be about getting the right people around the table to discuss things such as the barriers to FinTech sector growth for example. Open Finance for example would involve input from government departments, the SME community and industry bodies and involve getting the right experts in the room to drive real change. Mr Crosswell clarified that the coalitions would not consist of the same people but would have different people come and go as necessary. Ms Crosswell stated that she would be very interested in exploring links with Durham University further ad clarified that, in terms of student placements, CFIT would likely look for partnerships on this and were very interested in generating the discussions and momentum around this from the outset. The incoming CEO also had some direct experience on this.

The Chairman, on behalf of the Committee, thanked Ms Crosswell for a very interesting and informative discussion and wished her every success with the start-up.