A business group has called for the UK’s regulators to work with their counterparts in other countries to promote cooperation in fintech.
A report from trade body UK Finance called for ‘regulatory diplomacy’, whereby the Bank of England and Financial Conduct Authority would cooperate and collaborate with their counterparts in other countries towards improved market access.
The aim is to encourage other countries to open their domestic markets to UK-based financial services providers and promote cooperation in innovative areas such as AI, cybersecurity and fintech.
The report set out proposals such as this ‘regulatory diplomacy’ to place the financial services industry at the heart of the UK’s post-Covid-19 economic recovery.
It also suggested that the UK develop a comprehensive regulatory diplomacy strategy for financial services, continue to play a leading role in setting international financial services standards and build a network of formal platforms for regulatory and supervisory cooperation.
The report also said the UK should pioneer the innovation and expansion of cross-border trading models based on recognition, champion a range of World Trade Organisation (WTO)-level initiatives that will support trade in financial services and sustain the UK’s openness to imported financial services.
“The banking and finance sector is a significant contributor to the UK economy,” said David Postings, chief executive of UK Finance.
“The industry’s trade surplus is vital, and we are keen to work with the government and regulators to increase these benefits for the UK.
“We are setting out the tools available to policymakers to achieve this, from using regulatory agreements and free trade deals to open up new markets overseas to playing a leading role at global standard-setting bodies like the WTO and Basel Committee.
“This would deliver significant benefits for the wider economy as we recover from the impact of the Covid-19 pandemic, increasing exports in other sectors, generating jobs and driving down costs for consumers.”
The UK is the world’s top net exporter of financial services, above the United States and Switzerland, with a financial services trade surplus of $77bn (£60.3bn) in 2019.
“The UK has long been and continues to be a champion of free trade on the world stage,” said Gerry Grimstone, UK minister for investment.
“Financial services is one of our most productive and innovative sectors, helping to drive our economic recovery by creating jobs and growth across the country.
“I welcome the role that organisations such as UK Finance play in representing the interests of the financial services sector as part of the UK’s ambitious global trade policy.”