Barclays announced on Tuesday that it would be opening up Europe’s biggest fintech centre. Despite the worries around Brexit, the UK-based bank is counting on the country to remain an innovation hub for financial firms by opening its co-working space in London.
Focus on nurturing new fintech startups
While the innovation centre, which will be located in Shoreditch, will house the bank’s in-house banking and technology teams, it will also be home to over 40 co-located fintech startups. The space will also feature monthly workshops, ‘hackathons’, and networking and learning events.
The objective is to not only help the startups to developed new innovative ideas in the financial services sector but also encourage the in-house team to be more experimental with its product development. For the startups, working alongside seasoned bank staff can be valuable and guide them through the world of business.
Becoming a technology leader
The Shoreditch facility in London is just one part of Barclays’ new effort to become a leader in the technology sector. Barclays’ Rise Program has started supporting around 70 firms operating in the bustling fintech sector. The signed ventures include blockchain innovation, as well as big data firms.
Jes Staley, Barclays Group chief executive, said in the official statement, “We believe that technology must be a core competency of a global financial institution”. He continued by stating, “Fintech start-ups are at the front of the technology wave that is changing our industry”.
Furthermore, Michael Harte, Barclays’ head of innovation, said the venture could be fruitful because of its disruptive and vibrant nature. This, according to Harte, will provide more value to the customers and shareholders, as well as the financial services sector.
Were Brexit worries unfounded?
Barclays’ decision to create a huge fintech innovation hub in London comes after uncertainty over Brexit and its impact on startups. Some startups have already showed nervousness over Britain’s decision to exit the European Union – firms are unsure at the moment what the Brexit vote will result in terms of freedom of movement and financial regulation.
However, there have been plenty of opposite news as well, not just from Barclays. A leading equity crowdfunding platform Crowdcube announced it has managed to raise over 2.7 times more than its nearest rival. Over 10 companies attracted more than £1 million in funding on the platform, including a few technology companies, such as POD Point.
Luke Lang, co-founder of Crowdcube said, “Despite posturing from some EU leaders, we’re confident Britain will retain its position as a financial services powerhouse because of its innovation and flexible regulatory regime”.
According to data, fintech funding in the UK has fallen by 33% following the Brexit vote in June 2016. Nonetheless, the positive mood might be the result of recent months showing signs of funding recovery. While overall funding has declined, the final quarter of 2016 witnessed an improvement in funding.
The deciding factor will be the UK’s ability to retain talent, which will depend largely on the outcome of the negotiations. But other European cities are certain to start focusing on how to attract Europe’s growing fintech startups on their shores.