Accountancy firm EY has launched its first Scottish fintech “lab”, based in Edinburgh, to collaborate with start-up and scale-up companies in the sector.
Located in EY’s Edinburgh office, the new lab is described as “a dynamic workspace designed for collaboration, experimentation, and rapid test-and-learn prototyping”.
EY, declaring its wish to “help Scotland become one of the world’s leading fintech clusters”, said: “Fintechs, potential investors, clients, established financial services firms, regulators and other partners based in Edinburgh and across the UK will be able to connect to share information, brainstorm ideas and develop real-world solutions to serve markets and customers more effectively.”
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The launch follows EY’s opening in 2022 of a fintech lab in London, its first in the UK.
The new Scottish lab is designed to collaborate with start-ups and scale-ups to “create innovative solutions to key financial challenges”, with a particular focus on sustainable finance, EY said.
The accountancy firm noted the first cohort of start-ups in the new Scottish fintech lab explored the connection between space science data and finance.
It added that, following a successful introductory summit in 2023, sector body FinTech Scotland, EY, and Space Scotland, supported by the UK Space Agency (UKSA), led a programme of activity that aimed to “deepen the understanding between the financial services and the space industry”.
EY said: “The programme called for proposals of new projects that could provide data to support financial firms’ development of products, in particular to help manage climate change.”
The accountancy firm noted the winning submission had come from Environment Systems and Earth Blox, focusing on commodities use.
Edinburgh-based Earth Blox, “a no-code spatial data SAAS” (software as a service) company, and Environment Systems, an environmental and agricultural data consultancy, joined forces to demonstrate how the financial services sector can use spatial data to maximise the value of their portfolios from nature-based insights.
The project combined local and global spatial data to identify nature and climate risks for agricultural commodities such as asparagus, potatoes, and soy, EY noted.
It demonstrated how businesses can gain insights into crops in individual fields and scale them to understand potential impacts on yields at a local, national, and global level.
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The solution identifies areas that are unsustainable for growth and optimum locations for future production, while ensuring compliance with environmental regulations such as the EU Deforestation Regulation and the corporate sustainability reporting directive.
Sue Dawe, EY Scotland financial services managing partner, said: “We’re seeing some very exciting start-up and scale-up activity across the UK, and Scotland’s fintech sector is going from strength to strength.
“The new fintech lab in Edinburgh will tap into the growing appetite for innovation across Scotland’s financial services sector and will develop the talent we already have in our market.”
She added: “With ‘fintech for good’ being high on the radar, our new lab’s focus on sustainable finance will help firms respond to a key industry and social challenge. The launch of the lab in Edinburgh demonstrates our commitment to the growth of fintech and, as a strategic partner to FinTech Scotland, we will continue to collaborate to help Scotland become one of the world’s leading fintech clusters.”
Nicola Anderson, chief executive of FinTech Scotland, said: “Scotland's fintech growth embodies the power of collaboration across sectors, igniting innovation that not only fuels new enterprises but also drives positive change for our economy and society.
“We are delighted to welcome the Edinburgh EY innovation lab into the cluster. The lab's areas of focus, including financial inclusion and sustainability, align strategically with the priorities of the FinTech Scotland cluster. Together and collaboratively, we are poised to drive meaningful change, leveraging technology to create a more inclusive and sustainable financial ecosystem.”
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Hina Khan, executive director of Space Scotland, said: “Through strategic collaboration with FinTech Scotland and EY, we are delighted to bring the potential of geospatial data into Scotland’s financial services industry.”
She added: “By leveraging innovative data and technologies across industries, we expand the overall potential for Scottish businesses. Space Scotland has been working with Fintech Scotland through the UKSA cluster development programme to increase the use of EO (Earth observation) data into the financial services industry.
“The launch of the EY lab in Edinburgh with the first cohort of EO data companies developing solutions for the fintech sector is a great outcome from the joint accelerator programme.”
Since its launch in December 2022, EY’s London fintech lab has run five “innovation sprints”, connecting fintechs and established financial services firms. Chris Woolard, EY’s UK head of fintech, said: “Fintech plays a fundamental innovation role for the UK market and is a key driver of competitiveness on the international stage.
“We set ourselves a clear and ambitious growth plan for EY’s fintech business in the UK, and the launch of the new lab in Edinburgh marks a significant next step forward. This is the second fintech lab we’ve launched in the UK, and we look forward to expanding our UK fintech growth this year.”
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