This page shows the latest data on the firms supported by FCA Regulatory Sandbox and Innovation Pathways services including sectors, technologies, areas of innovation and locations.
Since its launch in 2014, the FCA Innovation Hub has supported a diverse range of firms, from incumbents to FinTech start-ups, allowing firms to test innovative products or services in a live market through the Regulatory Sandbox or helping firms resolve regulatory questions through Innovation Pathways.
Through the support we have provided, we have collected data and valuable insights into the rapidly developing UK FinTech market. This gives us a deeper understanding of how new technology is being used, informs our policy, and helps us understand the barriers to access faced by new business models.
The data provides a picture of the firms supported between 2014 and 2022. While we classify technologies and areas of innovation based on existing observations, we welcome applications from new areas that are not covered in the charts.
Key facts:
- 9 years of support to innovative businesses serving UK consumers
- Over 2,400 applications received
- Until end of 2022, we supported 867 firms, including 168 firms and products accepted for testing in the Regulatory Sandbox
- We support firms of all sizes and at any stage of development, provided they meet our eligibility criteria. This includes:
- start-ups, scale-ups and incumbents
- firms that are regulated and those seeking to be regulated, and technology providers
- UK and international firms serving UK consumers
1. Sector
We support firms across all financial services sectors. This includes firms providing financial services directly and those providing technologies to financial services firms.
Graphs 1 and 2 show that historically we have accepted the biggest number of innovators in the retail banking and payments, investment and retail lending sectors. The ‘cross-sectors and others’ category refers to products or services that are not specific to one sector, such as software or RegTech solutions for financial services providers.
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2. Technology and area of innovation
We have supported the implementation of a wide range of technologies in the financial services industry. Recent use cases in the Regulatory Sandbox include:
- Open Banking technology to accelerate impact assessment in the Environmental, Social and Governance (ESG) space and affordability assessment for underserved borrowers,
- digital ID to enable smoother and more transparent housing transactions and access to financial services,
- development of software/app/platforms underpinned by analytics to improve ESG outcomes for consumers, investors and firms,
- blockchain to facilitate more efficient low-cost cross-border payments, security issuance and execution process.
View the full list of Regulatory Sandbox supported business models[2]
Our support is not limited to technological innovations. Graph 3 shows 10% of Regulatory Sandbox firms innovating in business models and providing new products to address specific consumer needs.
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Graph 5 shows 23% of recent years’ Innovation Pathways firms use advanced analytics. Given our focus on the automated advice area following the publication of the Financial Advice Market Review, the mainstream use cases involve automated advice or guidance models developed within investment, insurance, mortgage, and debt-counselling sectors, illustrated in graph 6.
Graph 5 shows 14% of Innovation Pathways firms develop mobile apps or website platforms, highlighting the continuing digitalisation of the industry.
In 2022 the common innovations we supported within Innovation Pathways include:
- Open Banking use cases in Robo-advice and data infrastructure areas
- blockchain use cases within the payment and wholesale markets sectors
- process innovation, InsurTech and embedded finance propositions
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3. Location
London is a globally recognised hub for FinTech, but innovative businesses in the UK are not limited to London. Graphs 7 and 8 show most Regulatory Sandbox and Innovation Pathways firms are based in the UK, with 65% of Regulatory Sandbox and 54% of Innovation Pathways firms based in London.
While our remit lies within the UK financial services industry, we also support international firms wanting to expand into the UK. We have been actively engaging with UK regional firms and industry associations to increase awareness of our services and we encourage applications from areas including Wales, Scotland, Northern Ireland and British Overseas Territories.
For UK and international firms looking to expand to multiple jurisdictions, we offer the Global Financial Innovation Network[3] where innovative firms can engage with regulators across countries and trial cross-border solutions.
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Copyright
The data on this page is available under the terms of the Open Government Licence[4].