“FinTech is a key tool in the government’s toolkit to turbocharge the Levelling Up efforts”

Business Leader recently chatted with Roxana Mohammadian-Molina, Chief Strategy Officer at specialist tech-powered development finance lender Blend Network, who argues that FinTech must be a core element and key enabler of the Levelling Up plan for growth and jobs, and how financial technology is already quietly but helping Britain build back better following the pandemic.

What is your take on the role that FinTech can play in helping us end the geographical inequality across the UK and in tackling some of our key challenges such as job creation?

The pandemic has underscored the power of digital technology. Now, more than ever before, is the time to grasp this historic opportunity and harness this power for inclusive growth so that we can fix the problems that have historically held back parts of the UK and empower communities across the country to thrive. I am particularly talking about the housing market, where we know an enormous imbalance exists between supply and demand, and the historical north-south divide that has been deepening.

Regarding the former issue, estimates have put the number of new homes needed in England at up to 345,000 per year, accounting for new household formation and a backlog of the existing need for suitable housing. Yet between April 2019 and March 2020, around 244,000 homes were built in England – the highest number since 1987 and around 1% higher than the previous year – but still lower than the estimated need.

Funding, or rather the lack of it, is one of the key reasons for not building enough homes. Regarding the latter issue, according to a recent report, England’s north-south divide has continued to deepen. Once again, the lack of available funding is one of the main constraints. FinTech solutions such as platform financing have demonstrated to be an effective solution helping SME property developers and small construction companies unlock funding to help build more homes and infrastructures. There is no doubt in my mind that FinTech can play a central role in helping Britain build back better

How do you think that FinTech can help Britain build back better, redress some of the problems that have historically held us back and level up opportunities across the country?

Well, the FinTech sector is already quietly but consistently helping Britain build back better. The sector as a whole adds almost £11 billion to the UK economy and employs a workforce of almost 76,500. Many areas of FinTech are thriving and many FinTech solutions are actually supporting small businesses that have been badly impacted by the global response to the pandemic.

For example, digital payment platforms have eased a transition from offline to online transactions and their use has skyrocketed. But I am most passionate about the opportunities arising across the housing and infrastructure sectors to help Britain build back better and redress the UK’s historic underinvestment in these sectors.

Even before the pandemic hit, government finances were already tight when it came to public funding available to build more affordable homes. The pandemic has put an even greater burden on government finances to deliver on the government’s housebuilding targets. In this context, FinTech solutions and platform financing is an effective and necessary solution, one that the government must take seriously if it is to tackle the housing crisis. We’ve already witnessed how equity crowdfunding and peer-to-peer financing platforms continued to meet and support the funding needs of small and medium enterprises (SME) throughout the pandemic.

What are the opportunities for Britain’s FinTech in the post-pandemic post-Brexit world?

I have been very vocal about how post-Brexit UK could become a FinTech powerhouse. I believe FinTech is an industry where opportunities abound and, if appropriate steps are taken to support the sector, the UK could become a powerhouse in the post-Brexit world.

The Kalifa Review of FinTech published in February 2021 also suggested that innovation in FinTech has the potential to maintain the UK’s status as a world leader in finance post-Brexit. The review addressed a range of priorities for the sector and made recommendations on amendments to UK listing rules, improvement to tech visas, and a regulatory FinTech ‘scalebox’.