Fintech

Our work on fintech is wide ranging and looks at how technology is changing financial services.

What is fintech and why are we interested in its impact?

Combining the words ‘financial’ and ‘technology’, fintech is technology-enabled financial innovation, which is changing the way financial institutions provide – and consumers and businesses use – financial services.

Although ‘fintech’ is a relatively new term, innovation has always been important in the financial sector. The key difference now is the pace and impact of change. This trend prompted us to develop the Future of Finance initiative, which explores how the financial system might change over the next decade, and what it means for our priorities now and in the future. 

We are actively exploring how developments in fintech might support our mission to promote the good of the people of the UK by maintaining monetary and financial stability. 

To embrace the potential of fintech we are:

Understanding how fintech developments may affect systemic stability

Understanding how fintech developments may affect the safety and soundness of firms

Applying fintech, where appropriate, to enhance our capabilities

Our Fintech Hub brings together all our work in this area. Sir Dave Ramsden, our Deputy Governor for Markets and Banking, spoke about the importance of being open to fintech when he launched the hub in March 2018. We also have an active regtech agenda.

Latest updates

26 February 2021: Following the launch of the Artificial Intelligence Public Private Forum, in collaboration with the Financial Conduct Authority, we held a second meeting focusing on the topic of data. 

The aim of the roundtable discussion was to identify and discuss the key issues and challenges around data quality, data strategy and economics, data governance, ethics, and culture and data standards and regulation. 

18 December 2020: We published a QB article on the impact of machine learning and data science in UK banking

This article reports findings from a survey conducted in August 2020 of banks headquartered or operating in the UK. The survey sought to understand how Covid-19 has affected the adoption and use of machine learning (ML) and data science (DS). Investment and interest in ML and DS has remained broadly stable which is significant given wider market volatility and the economic downturn would usually result in constrained budgets for investment in innovation. 

18 November 2020: Andy Haldane, Chief Economist and member of the Monetary Policy Committee at the Bank of England, delivered a speech at TheCityUK 10th anniversary conference on developments in digital finance. 

The Covid-19 crisis has accelerated pre-existing shifts towards digitalisation. The speech sets out the digital opportunities in the areas of payments and lending are large and could help deliver lasting benefits to individuals and companies.  

 

Our publications on fintech

External engagement and initiatives

We closely monitor fintech developments in the UK and globally, and actively engage with the fintech sector, industry experts and other authorities. We regularly collaborate with public and private stakeholders to harness the potential of fintech.

Artificial Intelligence Public-Private Forum

In June 2019, former Governor Mark Carney announced plans to set up a forum to look at the impact of artificial intelligence (AI) and machine learning (ML) on financial services.

In October 2019, we published Machine Learning in UK Financial Services with the Financial Conduct Authority (FCA).

We are now working with the FCA to establish the forum and have published the forum’s terms of reference. The deadline for applications to become a member of the AIPPF has now passed. We will ensure that the forum’s design reflects a wide variety of views.

In line with UK government guidance regarding Covid-19, we decided to postpone the forum’s launch and first meeting. We now plan to launch the forum in October 2020.

The AI Public-Private Forum (AIPPF) will seek to:

  • share information and understand the practical challenges of using AI and ML within financial services, the barriers to deployment and any potential risks or trade-offs
  • gather views on areas where principles, guidance, regulation or good practice examples could support safe adoption of these technologies
  • consider if firms’ involvement could be useful and what form it could take

Regulation of fintech firms offering financial services in the UK

If you are a fintech firm thinking of providing financial services in the UK, you may need to be regulated.

We are responsible for supervising financial firms such as banks, building societies, credit unions, major investment firms and insurers. And we provide information and support for businesses that are thinking of setting up a new bank in the UK. 

We also supervise financial market infrastructure and we act as settlement agent for payment systems. 

Financial services in the UK are also regulated by the Financial Conduct Authority and UK payment systems are also regulated by the Payment Systems Regulator.

Working with fintech firms

As part of our fintech work, we have engaged in a number of proofs-of-concepts. We will continue to work with businesses on fintech proofs-of-concepts whenever this may help us fulfil our mission.

Contact Us

If you would like to get in touch about our work or events, you can reach us at fintech@bankofengland.co.uk.

This page was last updated 15 June 2021

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