Nearly half of fintech founders mull leaving UK ahead of crunch Budget
Growing frustrations with new government policies and regulatory concerns could further drive an exodus of UK fintech founders, a grassroots industry group has warned.
According to an annual report conducted by industry group Fintech Founders, some 39 per cent of the 450 leading entrepreneurs surveyed had expressed concerns over a “poor” and “awful” regulatory environment.
Half of the fintech founders surveyed between July and September said they believe their regulatory concerns are often overlooked, with others stating there is a lack of government understanding as to what support the fintech sector needs to grow.
Some 43 per cent said they have already considered relocating out of the country, with a majority naming access to funding as a key decision-maker.
“The UK remains an attractive place to start a business, but if founders don’t feel supported in their growth journey, they will look to greener pastures,” Seb McDermott, co-chair of Fintech Founders and co-founder of Koodoo, said.
He added: “Among many other things, founders create jobs and attract much needed investment into the UK, which will be critical to achieving the government’s growth ambitions.”
Just one fifth of those surveyed said they were confident in a new change of government. However, some 25 per cent had said it would create a “worse environment”.
A number of industry leaders within Fintech Founder’s network also fired warning signs to the new government earlier this month that hiking capital gains tax in the upcoming Budget on 30 October risks losing top talent.
An open letter to the Chancellor, signed by 66 fintech founders and chief executives, said that while members of the group “do not want to relocate, founders are increasingly considering leaving the UK”.
Labour has warned its maiden Budget will be “tough” as it rushes to plug an alleged £22bn “black hole” in the public finances left by the previous Conservative government.
A Treasury spokesperson said: “We want to embrace fintech as the future of financial services – driving innovation, boosting investment and harnessing its potential to support financial inclusion and the wider economy.
“That includes unlocking billions of pounds of investment in the UK economy through our pension review so that more innovative companies can access the capital they need to grow.”
The FCA was contacted by Morning Wire for comment.