Innovation relief is at hand for UK Fintechs
As Coronavirus dominates the agenda, with the Chancellor announcing £330 billion in relief measures to deal with its impact, it’s positive to see the UK Government also focusing on the longer term economy by helping develop the nation’s burgeoning Fintech sector.
07 April 2020
In his first Budget earlier this month, Rishi Sunak focused a great deal of time and money on innovation-related measures. His plans to significantly increase public R&D investment to £22 billion per year by 2024-25 are a welcome development that should have a significant and positive impact on Fintech companies.
While it’s impossible to ignore the current implications of the global Covid-19 pandemic, it is encouraging to see the UK Government recognising a sector that will be one of the leading lights in driving economic growth in the longer term.
Across the UK, more than £7.6bn was raised by UK-based Fintechs between 2014 and 2018. Investment within the UK sector more than trebled from £685.3m in 2014 to almost £2.4bn in 2018. Meanwhile, as reported earlier this year by FinTech Scotland, the number of fintech SMEs based in Scotland has grown by more than 60 per cent, from 72 to 119 over the past year.
The additional investment set out in last week’s Budget adds to the package of innovation incentives and other forms of financial support available to aspirational Fintech businesses. The UK Government’s R&D (research and development) tax relief scheme offers innovative companies – and there are many within the Fintech sector - up to 33p for every pound spent on qualifying R&D (dependant on the company status and its financial position). In a drive to maintain the country’s position as a global leader in science and technology, the scheme offers those investing in product or process improvements significant tax breaks provided they meet the required criteria.
Article originally published on Fintech Scotland