With FinTech startups exploding on the scene, U.K. and Korea want to make it easier for both companies to invest in the financial technology sector, creating a so-called “FinTech bridge.”
The agreement, which was announced on Friday (July 22), will provide U.K.-based FinTech companies and investors access to the Korean market and Asian investors and Korean FinTech companies access to the U.K. markets. The agreement, which garnered approval from the Financial Conduct Authority (FCA) in the U.K. and the Korean Financial Services Commission (FSC), will make it possible for regulators in both countries to collaborate and provide information about financial innovation. Korea is a newcomer to the FinTech market, but the country is focused on developing a regulatory environment that fosters rapid growth, said Yim Jong-yong, chairman of the FSC. The FinTech bridge is another piece of deepening a relationship between the two.
The new agreement comes at a time when Britain has become the leader in the FinTech movement, which is turning traditional banking on its head. More FinTech employees reside in the U.K. than in New York, Singapore, Hong Kong and Australia combined. According to the British Treasury in 2015, the FinTech sector employed more than 60,000 people in the U.K. and generated $8.7 billion in revenue.
“The newly established FinTech bridge between the U.K. and the Republic of Korea is an important step for one of this country’s most exciting industries,” said Philip Hammond, Britain’s new finance minister, in a statement. “The government is determined to help the U.K. FinTech sector to innovate and grow and to ensure that Britain remains the location of choice for FinTech startups.”
The one wild card in the U.K. and Korea’s new agreement is how Brexit will impact the startup market in the U.K. Ever since the historic vote to exit the European Union, concerns have been mounting that companies will leave the U.K. and that the British country will fall into a recession. According to Reuters, 10 London-based FinTech startups have already looked into moving out of the city and to Berlin.