There is no doubt that the financial services sector is vital to the UK economy. What is perhaps less apparent and not broadly recognised is that two thirds of jobs in the sector are outside of London. Manchester has a thriving financial services sector with over 60 banks based in the city, including the head offices of the Co-operative Bank and Williams and Glynn. It is not just about banking; the city's diverse and growing financial services industry also includes insurance, asset management, professional services, and private equity firms.
Manchester based financial services institutions face the same challenges in adapting to the changing financial services landscape as do those based, not just in London but all across the UK. Alongside the City's established financial services industry is a growing fintech sector that is springing up in the context of a strong and growing digital economy. According to research carried out by Tech City earlier this year, in the Greater Manchester area, new digital companies grew by 70% between 2011-2013 and many of those were in financial technology. In addition, research conducted by ebay's Public Policy Lab, looking at the concentration of online businesses, found that Manchester has the greatest 'Digital Density in the UK.
Manchester clearly has the potential to help realise the Chancellor's vision for a Northern Powerhouse. It benefits from a significant pool of talent with both digital skills and experience in financial services and lower operating costs (office space, housing, labour) than London. This creates a real opportunity for a vibrant start-up culture that can address the needs and opportunities generated by the digitisation of financial services
There are challenges that need to be met, however, in order to harness the potential of Manchester's evolving fintech sector. Improved infrastructure, both within the city and better and more affordable links between regional urban centres, and a pool of talent that can meet the pace of expansion will be key areas of focus. The establishment of Tech North will help identify potential bottlenecks and barriers and help support the continued growth of another UK fintech centre. techUK has a wide range of members across Manchester and the Northwest who will be key players in this evolving ecosystem.