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businesses during these times,” he said. “We are one of the best capitalised banks in the UK and, given the careful credit decisions we have made thus far, are in a strong position to continue leading at a time when many banks are retrenching from the market. This creates an opportunity for us; since the vote, we have closed over £200 million in deals (including a £19 million deal with restaurant chain Leon), and in fact, the day after the vote, we had two opportunities come in as a direct result of larger banks pulling out of deals.”
Whilst Chris Gledhill, formerly of Lloyds Banking Group and now CEO and Co- Founder of FinTech venture, Secco, wrote
in an IBS Journal blog post: “I’m now bored of all the sour grapes and negative comments from the remain camp. The silly stickers and t-shirts didn’t work. ‘Project Fear’ didn’t work. It turns out the Brexit folks weren’t some crazy bigoted simpleton minority like we were made out to be but actually the majority of UK folks. Ordinary people who voted for long term self-determination over short-term stability. The referendum is over and the people have decided. It’s time to respect the majority decision of your peers and pull together for our future. Leaving the EU is a big risk to the UK but it’s also a big opportunity to shape our own destiny; let’s make it a good one together!”
What does Trump mean for FinTech?
“So we did it. America actually elected an internet troll as our President.” So quipped comedian Dave Chappelle on Saturday Night Live. Which pretty much summed up how many in the tech industry felt upon hearing that a former reality TV star was set to run the country. Certainly, the Trump brand is toxic in Silicon Valley as the furore over Peter Thiel’s donation to his campaign highlighted (see News section for more on this).
We couldn’t have a 2016 review without mentioning the seismic shift in US politics that is the Trump Presidency. On top of his right-wing populist administration, the Republican Party will control
www.ibsintelligence.com © IBS Intelligence 2016
both houses of Congress, a combination that has not been experienced since the Bush era. And that worked out well, didn’t it?
So how will it affect FinTech? Will a Trump Presidency be good or bad for tech startups? Truth be told, it’s too early to say how he will translate campaign promises into policy, given his unpredictable nature and the fact that we have to wait until January for him to be sworn into office. But rest assured, dear readers, IBS Journal will be on the case throughout 2017 and beyond.
Open Banking revolution is nigh
Most UK current account holders are steadfastly refusing to move providers, despite incentives worth up to £220 being offered by FIs. Plan A, the Current Account Switch Service (CASS), hasn’t worked. It’s time for Plan B.
The £750 million CASS, which ensures switching accounts will take no more than seven days, recently marked its third anniversary. There are 65 million current account holders in the UK. But despite millions of pounds being thrown at the initiative, movement has been minimal. Bacs, which runs the service, has facilitated just over three million switches since launching.
Cue yet another media blitz to boost awareness, but by this point there should be some recognition that the initiative isn’t working. In an interview with IBS Journal earlier this year, Tom Blomfield, CEO and Co-founder of mobile challenger bank, Monzo, said: “The switching process is automated but the account opening process is like pulling teeth; you go to a bank and you have to fill in dozens of forms and wait weeks for anything to happen… CASS is like a weird mechanical solution to a problem that is driven by lack of competition.”
The need for open access in all areas of financial infrastructure is therefore greater than ever. Open Banking legislation and the revised Payment Services Directive (PSD2) means banks will soon be required to share data with third parties. A couple of months ago, the CMA published the final report on its retail banking market investigation, requiring banks to implement Open Banking by early 2018. Whether you are an incumbent or a new entrant, you will be able to take advantage of a new, open marketplace. What’s not to like?
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