Draft Brexit deal would expose NI fintech sector to “unnecessary risk”
THE DRAFT agreement on EU withdrawal will leave Northern Ireland’s rapidly growing fintech sector exposed to “unnecessary risk,” an industry expert has warned.
Peter Oakes, founder of trade body Fintech Ireland, said that the draft terms of the EU Withdrawal Treaty offer “nothing positive” for fintech businesses in the province, as they do not resolve the question of passporting rights for the financial services industry.
“I can tell you there is nothing positive in [the draft agreement] for either the UK or Northern Ireland when it comes to the outward passporting of financial services,” Oakes told Peer2Peer Finance News. “Their challenge is to ensure that their government actively engages with the EU to find a suitable way forward.
“Fintech in Northern Ireland has grown exponentially with some incredibly smart people setting up some incredibly innovative firms and what we don’t want to see is Northern Ireland firms being forced to take on unnecessary risk because of a cliff-edge Brexit.”
Oakes’ comments tally with the fears of small businesses and fintech operators across Northern Ireland.
According to recent research from the CBI, more than 90 per cent of the business group’s Northern Ireland members believe that the proposed backstop is a better outcome for the Northern Irish economy than ‘no deal’.
Read more: New fintech hub opens in Belfast
Meanwhile, prominent fintech firms such as AI manufacturer Neurovalens have warned that they may be forced to leave Northern Ireland after Brexit.
Northern Ireland has developed a reputation as a fintech hub in recent years, thanks to a combination of low corporate taxes, low overheads, and a large graduate population.
Over the past year, peer-to-peer lenders such as Assetz Capital and Blend Network have increased their presence in the region, while Belfast is home to P2P-facing broker Clearpath Finance, crowdfunding platform CoFunder and SME lender Linked Finance.
This article featured in the December issue of Peer2Peer Finance News, now available to read online.