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  • Writer's pictureHannah Duncan

The extraordinary rise of Welsh FinTech

Updated: Mar 7, 2022

Think of Wales. What do you envision? Daffodils, coal, rugby, sheep, singing, leeks or a roaring red dragon? Distinctively Welsh, but far from modern. Who would have thought that the future of our technology could lie within these unlikely parameters?

Well it turns out FinTech Wales do, fiercely. And the many companies, leaders and even members of government backing them. This month I was delighted to attend the first ever FinTech Wales event in Cardiff and witness for myself the spirit and passion behind the movement. If you’ve ever watched a rugby match in the Principality Stadium, then you already know the kind of atmosphere that Welsh support can create. If not, you may be about to as the tech world rallies up and gathers momentum.

“This is a phenomenally vibrant market and Wales is a powerhouse. Change is happening, it has already been made and continues to be made. Heaps of organisations are pushing the boundaries everyday”.

Blending Finance and Technology in Wales

FinTech is the edgy name for Financial Technology, which refers to the digital mechanisms behind our financial products and services. Broadly speaking it is any form of technology which has a financial function. Most of us will use FinTech every day without realising it, as it includes platforms such as online payments or e-banking, as well as market-related services such as investment apps or even cryptocurrency.

In practice, there is an undercurrent characteristic which most FinTechs share. A little hint of insider snobbery, which has come to define how we view their world. This is the approach of challenging, disrupting or even replacing the traditional financial ways of doing things[1]. Today’s ambitious FinTech is looking shake up the norm and create even more convenience for its customers. Long gone are the days when a closed bank meant that your transaction was impossible. Today you can almost access a one-stop shop of everything you need on your smart phone. Once a dark horse, it’s an exciting time for Wales as the country looks to take the lead in the futuristic FinTech space.

The irresistible rise of FinTech in Wales

“Finance makes up a significant proportion of our UK GDP. Thinking that FinTech isn’t important is crazy. FinTech is the future, with Wales becoming the dragon behind it”

Sina Yamani, Managing Director of Lynq, a leading Cardiff-based Open-Banking and Blockchain technology firm

Second only to London, Wales is the destination of choice for today’s FinTech offices. Cardiff certainly holds a magnetic attraction for founders. The city hosts some formidable tech and finance giants. The Godfathers and Godmothers of Welsh FinTech. You can expect to find companies such as BT, Dell, Admiral, EE, Go Compare, HPE and Deloitte. It is also the home to rising stars such as Wealthify, Hodge Bank, Lynq, BipSync, Sonovate, Illustrate Digital and many more. With a FinTech backdrop this vibrant, the stage has been set for some time for Wales to lead the way. Local law firms and business schemes have become specialised in the sector. With the big tech players firmly in place, more and more firms are emerging and setting up in Cardiff.

The Welsh FinTech sector alone boosts the economy by an impressive £8.2 million annually and counting. And the good news doesn’t stop here, according to a recent survey, Welsh technology firms turned over a staggering £1 billion this year. This puts Wales well and truly on the FinTech map. The amount of money it is pulling in is eye-watering, considering its grass-root foundations. The sector in Wales also supplies 40,000 jobs. This is truly impressive considering Cardiff’s total population of around 350,000 people.

The movement is being supported by the government and foreign investors , who are putting their money where their mouth is. Back in 2014, Cardiff received foreign funding of £62 million to develop its FinTech space. In November 2017 Welsh Government Economy Minister Edwina Hart announced:

“We have serious ambitions to make Cardiff the most competitive UK city outside London for the financial and professional services sector and aim to ensure the city becomes the international location of choice for businesses in this sector”.

A unique destination, the city boasts a characteristic blend of city life and personality which may appeal to founders. Alongside it’s leading further education programmes, cheaper office space and more affordable salaries, Cardiff has become a haven for FinTech pioneers.

Two years on, I proudly attended the first ever FinTech Wales event to find out more.

The impact of FinTech Wales, the champion behind the movement

In April this year, FinTech Wales was unveiled. Pioneered by key figureheads such as FinTech Envoy for Wales Richard Theo and Managing Director & Founder of the FinTech Wales Awards Matt Hyde, FinTech Wales is a non-for-profit organisation which champions Wales’ progress. Creating a formidable advisory board made up of impressive industry leaders was just the beginning. FinTech Wales offers extraordinary levels of advice, networking opportunities and direction to new tech businesses.

“The journey has been really interesting, Matt has got people, resources and he’s got the initiative moving. By introducing the right people, he brings things together… what can I say? The FinTech movement is certainly gaining momentum”

Che Hookings, MD Recruit 121

Ambition is surely the defining feature of FinTech Wales. Hungry to surpass London and even become the world’s leader for financial technology, the team are looking to make Wales unrivalled go-to for founders.

A strategy with a heart

“Bringing together all the movers and shakers and getting involved is a fantastic way to help lift this movement off the ground”.

Karl Foster, Head of FinTech at Blake Morgan LLP

What’s different about the organisation is that they want to achieve this by sharing more ideas and bringing people together. And why not? After all, today’s world is dominated by corporate-driven climate concerns and fierce political entanglements. Why shouldn’t we start putting innovation and solutions ahead of competitive secrecy? In fact, has there ever been a better time to look to a more progressive way of doing business?

“It's very exciting to see the diversity of FinTech companies in the room, and the opportunities to collaborate”.

James Christian, Development Director at Backbase

In his speech, General Secretary for FinTech Wales Gavin Powell highlighted the many benefits of working together in a united movement for:

  1. Encouraging and nurturing new ideas

  2. Reducing the risk for start ups

  3. Attracting new business investment

  4. Protecting anchor companies

  5. Accelerating growth for all

  6. Providing resilience against economic change

Whether you are part of a FinTech company or based in Wales is not important, your ideas and support are appreciated. FinTech Wales want to work together collectively to foster creativity and solve problems. Everyone is invited to the party. Often when I attend events like these, there is an air of hierarchy. An edge of elitism, name dropping or one-upmanship. However I didn’t feel it here. Despite the presence of Wales’ most impressive tech and legal leaders in the room, there was a welcoming and inclusive atmosphere which is rarely captured elsewhere. The famous friendliness of the country shone out in the gathering, as different businesses came together to talk about new possibilities.

“Being a passionate Welsh supporter, I found it lovely that we can all be a part of this fantastic initiative going forward. It’s great to be involved in the FinTech Wales movement, and pushing it even further”

Dylan Ross Vine, Sales Manager, Secure Trading

A helping hand

As part of the event, FinTech Wales organised a series of complementary ‘break-out’ workshops for new businesses, ranging from accessing finance to navigating the legal matters. Organised with volunteers, this service is invaluable to new market entrants looking to get a foothold into the industry.

With seemingly endless access to useful information and possibilities to rub shoulders with experienced industry leaders, new founders are in a great starting position.

“It’s a really interesting event, it’s great to see this kind of thing happening in Wales, with such a high level of seniority in the room”

Ifan Jones, UX Designer, Ground Creative

So, what is the future of Welsh FinTech?

What a question! Well at the moment the sector looks to have a refreshingly bright future. With exciting new firms emerging every day backed by a fiercely loyal organisation, the atmosphere is buzzing with anticipation. Anything feels possible in this new and adventurous space.

FinTech in Wales has been clocked by organisations across the board, and featured prominently in the Wales 4.0 report published by the Welsh Government last September. It seems that everyone is backing this thriving new industry, and doing what needs to be done to propel it even further.

Going forward, FinTech Wales continue to drive momentum and have stated their three action points for the future:

1. Ignite collaborative innovation
2. Move to make, buy, team up and steer decision making
3. Create a national sector-based strategy

In the coming months and years the organisation will be looking to scale up and collaborate with more events, advisory boards and school schemes.

"Across the UK, there is an opportunity to build a strong and vibrant FinTech sector, which is substantial and continues to grow. For an organisation such as FinTech Wales, there is a chance to connect national policy with initiatives for strategic growth and innovation the across financial services industry"

As Wales begins to enter another chapter in its history, some things stay the same. Real passion, team spirit and togetherness make for a stronger movement. The future of FinTech Wales is limited only by the imagination of it’s members, so it’s fair to say that the journey will continue to be truly extraordinary.

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