Additionally, the UK-EU Trade and Cooperation Agreement, which came into effect on January 1, does not make provisions to continue the free flow of financial services between the UK and the EU. For example, euro-denominated shares traditionally traded in London have moved to EU-based stock exchanges to retain easy access to all EU investors. The Kalifa review has suggested changes in law to encourage Fintechs in picking the UK to its primary trading base.
It is hoped that the outcomes of the review will address these challenges quickly with targeted regulatory amendments, with the goal to ensure the UK retains its crown as one of the world major finch hubs Alongside the Tech-Visas, we believe you will likely see proposed changes to the UK listing regime to include duel class share structures which with this address flexibility could make the UK more attractive fo public listings.
With the UK being home to 8 of the worlds 70 Fintech Unicorns (Fintech start-ups now valued at over 1 billion US dollars) including the likes of TransferWise (Valued at US$3.5bn), Greensill (US$3.5bn) and Monzo (US$2.6bn) the importance of the Fintech sector to the whole financial services industry in the UK can not be overlooked. The UK is home to the largest and most forward looking cluster of financial and professional services firms, and a consumer base with one of the highest Fintech adoption rates in the world.
The scope of the Review is impressive – ranging from Fintechs still at the early stages of seed funding through to larger, more-established businesses – and looking at the challenges faced by both. It is hoped if the Government responds positively, the Kalifa Review can be the launchpad for the Fintech sector in the UK.