London steps up ight for spoils from inancial tech boom

LONDON: From the shabby streets of east London, some of the brightest minds in technology and banking are plotting a revolution.

London’s ‘Silicon Roundabout’ has become one of the top hubs for financial technology – or fintech – where start- up firms are launching products to bypass traditional banks with phone apps and websites, or help financial firms adapt to a digital era.

Investment in fintech firms in Britain and Ireland swelled to 623 million pounds last year, more than double the 264 million pounds seen in 2013 and representing 42 per cent of fintech investment in Europe, according to research by consultancy Accenture released yesterday.

Although the United States continues to attract the lion’s share of fintech investment, London has established itself as Europe’s fintech hub and the pace of growth had accelerated this year, start-up firms and bankers told Reuters.

The Silicon Roundabout area around Whitechapel and Shoreditch claims to be the thirdlargest technology cluster in the world, after San Francisco and New York. And with most top banks and much of the world’s trading on its doorstep, London’s tech hub has put more of its focus on financial products.

“Right now, London clearly has an edge” over other fintech hubs, said Sean McCormack, co-founder of New York start-up Stockfuse, which creates gaming platforms that simulate a trading desk and help banks evaluate and recruit trading talent by using behavioural analysis.

“It’s noticeable that the financial institutions here are very eager to hear what entrepreneurs and start- ups are doing, because they’ve seen a little bit earlier that it’s something they need to catch on to,” McCormack said.

Stockfuse is among 10 firms picked for an ‘ accelerator’ programme run by Barclays in east London, which provides advice, access to bank executives, facilities and seed funding.

Four of the 10 firms in the 15-week programme are from overseas, and start-ups from 64 countries applied for a place.

It is one of several such programmes in London, including Accenture’s FinTech Innovation Lab which is backed by more than a dozen banks.

In return, banks supporting these kind of schemes potentially get access to new technology and expertise.

Banks have also sets aside tens of millions of dollars to invest in fintech firms and to spend on inhouse technology development.

While Berlin, Stockholm and Amsterdam are also trying to lure fintech entrepreneurs, investment in Europe is dwarfed by the United States, which attracted about three-quarters of the 12.2 billion pounds of global fintech investment last year, which was more than triple the funding seen in 2013, Accenture estimated.

Europe, by comparison, attracted 12 per cent.

Silicon Valley, home to some of the world’s biggest tech firms and thousands of start- ups, attracts a deep pool of investors and benefits from close links between academia, investment and business, as well as a history of successful entrepreneurs. — Reuters