The UK’s immigration policy and commitment to Brexit is potentially damaging its place in the centre of FinTech innovation, according to a new report.

Innovate Finance, in conjunction with WPI Economics, undertook the research following a call for input from the Migration Advisory Committee on the economic and social impacts of the UK’s exit from the European Union.

Baseline modelling found that the FinTech sector will continue to grow between now and 2030, meaning it will need approximately 33,500 EEA migrants to enter the workforce, particularly those with high skills.

Surveying and in-depth interviews with UK FinTech firms suggested that they are aware of this fact, and the potential move to a more restrictive immigration system is viewed as detracting from the attractiveness of the UK as a place to do business.

The sector currently employs some 76,500 people, of whom 42 per cent are from overseas – 28 per cent from EEA countries and 14 per cent from non-EEA countries.

However, 82 per cent of companies said they already face difficulties in recruiting non-EEA migrants. Under the most likely scenario for future immigration policy, in which the system for EEA migrants moves closer to that for non-EEA migrants, the report predicted a shortfall of 3,200 highly-skilled workers by 2030, at a cost to the UK FinTech sector of £361m.

Innovate Finance used its findings to call on the government to adapt a more flexible and proportionate policy on immigration and to redefine the meaning of ‘highly-skilled’ worker in today’s global jobs market.

Charlotte Crosswell, chief executive of Innovate Finance, said that while access to talent is a perennial issue, Brexit shines a light on it and risks exacerbating the issue further. “Without a flexible approach, the UK FinTech sector stands to lose its global pre-eminence with companies already facing challenges in recruiting appropriate skills and talent.”

Catherine McGuinness, policy chairman at the City of London Corporation, added that it’s essential the UK is able to attract international talent to unlock the full potential of this thriving industry. “This data shines a spotlight on the urgent need to clarify an immigration policy for European workers ahead of the UK’s departure from the bloc in March next year.”

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