CALLUM SINCLAIR
Post-Brexit it has never been more difficult for businesses or advisers to predict the course of events or the best path to take. However, with its emerging tech hubs and highly experienced resource pool, the Scottish financial services sector is well placed to tackle these challenges, continue to create jobs and stimulate the economy into 2017 and beyond.
The dissatisfaction of the Scottish Government with the decision to leave the EU is well known, as is its desire to do all within its means for Scotland to remain part of the single market. Ultimately, this may result in a second referendum on Scottish independence. So how is the Scottish financial sector faring in this daunting environment?
Today, many of Scotland’s innovators are to be found in the financial sector. With its highly trained workforce and technology focus, there is a feeling of confidence that Scotland will develop a key presence as a financial services technology hub, whether or not subsidiaries are required to gain access the single market. Technology and modern communications mean that there is no reason why the majority of work cannot still be carried out in Scotland.
The inherently cautious FS sector is now, finally, engaging with cloud sourced products and services and so, achieving operational benefits including scalability. The sector has been buoyed by fairly positive FCA guidance issued during the summer on cloud outsourcing, but practical questions remain over compatibility with core regulatory requirements, particularly around control and access to data. From a commercial perspective we see this as a dynamic and evolving area for 2017.
Application programming interfaces (APIs) are making a significant impact. For financial services, this allows banks to streamline their processes. In turn, it facilitates what will, in our view, be the biggest topic and challenge of 2017 – Open Banking. Government and EU initiatives have determined to open up access to data held by banks to stimulate competition and innovation in the sector. Already we are seeing some exciting ideas from Scottish businesses eager to be at the forefront of these developments.
Fintech disruptors are leading new competition, and major financial institutions will have to adapt to a market which is continually changing if they are to enjoy continued growth. Our experience is that banks recognise this, but as with all large, regulated institutions, face challenges of agility. Nevertheless, we are now seeing banks investing increasingly in new technology and beginning to partner more effectively with smaller fintech SMEs. If Scottish banks can continue to back promising fintech startups and innovate with their internal process, Scotland can realise its ambition to become a centre for fintech enterprise.
Callum Sinclair is partner and head of technology at Burness Paull
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules here