The UK government is set to introduce a special visa scheme that will give priority access to financial technology (fintech) professionals and allow them to work and settle in the UK.
The fast-track visa program that falls under the new immigration system is aimed at attracting tech workers from around the world to the UK. The new scheme would be formally announced as a part of the 3 March budget.
It is expected that the new visa scheme would off-set some of the effects of Brexit on the tech sector. The UK tech industry has lost a large number of skilled professionals after Brexit. The recent COVID-19 crisis forced even more EU citizens out of the country.
According to a recent study, the UK might be facing the largest population crunch since World War II. It was reported that more than 1.3 million foreign-born people left the country between July 2019-September 2020.
This major demographic shift is a cause of concern for most sectors, including the tech industry. Experts worry that such a large-scale exodus could lead to severe staff shortages in the future.
The new fintech visa scheme is being introduced to draw talented professionals from the global tech sector to the UK. It is being hoped that the fintech visa and immigration policy would cushion and support the UK’s thriving fintech businesses during these turbulent times.
A report by The Sunday Telegraph revealed that Chancellor Rishi Sunak is keen on sheltering the UK’s £7 billion fintech sector and its reputation for years to come.
It is worth mentioning London has emerged as a booming tech hub in the past few decades. It is home to major tech firms like Cazoo, Monzo, and Revolut.
These companies along with five other businesses headquartered in the UK recently achieved Unicorn status, meaning now they are worth more than £1 billion.
Brexit and the Fintech Sector
The UK’s split from the European Union (EU) has revoked the automatic right of EU citizens to work in the UK. Many EU professionals have exited the country as a result of uncertainty caused by Brexit and the pandemic.
The fact that thousands of EU citizens are leaving the UK is causing widespread alarm in the tech sector. It is being feared that Brexit might cause a brain drain in the country. According to tech experts, the visa scheme is a necessary step since there is fierce competition for talent in the global tech arena.
Fintech workers, who used to go to the UK to work in the past, are now receiving lucrative offers from tech businesses based in Berlin, Barcelona, and Amsterdam.
The New Fintech Visa Scheme
The new visa scheme is expected to emulate the current visa and immigration policy for UK-based tech companies.
The UK’s Global Talent Visa Scheme, which is presently in place in the UK was introduced in February 2020 to make it more convenient for skilled professionals to work and reside in the UK.
It is a reformed version of the UK Tier 1 visa (exceptional talent) route for skilled applicants who seek to apply in the UK but do not have a job offer yet.
The idea to introduce a new visa scheme was first proposed by ex-Worldplay chief executive Ron Kalifa in his review on how to improve the fintech sector after Brexit.
Chancellor Rishi Sunak’s fintech visa announcement coincided with the release of an important report by the PwC. According to the report, over 52% of financial institutes are expecting to have more gig-based employees over the next three to five years.
The report further predicts that more than 15 to 20% work of a typical institution will be performed by gig-economy employees within the next five years. It elaborates that factors like cost pressure and the need to access digitally skilled talent would drive this change.
PwC’s global financial services leader John Garvey explained:
“Leaders in the industry are looking seriously at their workforces to evaluate which roles need to be performed by permanent employees and which can be performed by gig-economy workers, contractors or even crowd-sourced on a case-by-case basis.”
Tech Industry Expected to Welcome the New Visa Scheme
The tech industry, already reeling from a rapid decline in skilled workforce, is expected to welcome this initiative to drive fintech talent to post-Brexit Britain.
CEO at digital challenger bank Tandem, Ricky Knox said that his company lost some of its staff after EU citizens decided to leave the UK after Brexit. “Over half of our coders are from outside the UK and some have already left due to Brexit,” he explained.
Lauding the news that a new visa system was being designed for fintech workers, he said that it (the visa scheme) would “help to ensure the UK remains a vibrant fintech hub for Europe.”
“Tech visas are a great thing and essential if we are going to keep a competitive tech and fintech sector,” he commented.
Similarly, the CEO at Azimo, Michael Kent also agreed that the new visa system was good news for the tech sector. He said that he and others had been demanding a specialist visa scheme for a while. “It is good that the UK government is taking this seriously. Fintech is all about people,” he remarked.