Fintech start-ups could be limited by the boiling recruitment market

AN AGGRESSIVE recruitment market could hamper start-ups in Scotland’s booming fintech sector, say senior fintech experts.

Backed by a £300 million investment from the UK government last August, the fintech The community is populated by a slew of financial services innovators, but newbies looking for talent face a “hot market,” making it difficult to obtain the skills needed to get started and function.

Anthony Rafferty, CEO of original UK fintech company Origo, said the recruitment crisis had changed dramatically in just a few years and was about to get even tougher, while the head of growth at ePOS Hybrid, Andrew Gibbon, said the opportunities outweigh the available talent. in all key functions.

Fintech specialists were speaking as Core-Asset Consulting published its seventh annual Salary Guide, which is a forensic examination of salary levels and major developments in Scotland’s pivotal financial services sector.

Origo has been in the fintech space for 30 years and is part of a group of vendors helping to deliver the UK government’s pension scorecard scheme. Mr Rafferty, Member of the FinTech Scotland Advisory Board, said: “Fintech is thriving in Scotland and our excellent universities are producing a pool of very good candidates, but at UK level there is a shortage of specialists and experts. .

“Fintech is a hot recruiting market, which is a testament to how many companies warrant good developers, testers and business analysts, but with salary inflation and higher candidate expectations, there’s no doubt that it’s getting harder to find the right skills than it was a few years ago.”

Edinburgh-based hotel technology specialist ePOS Hybrid is actively recruiting in key areas, but says “aggressive recruitment” is widespread across Scotland’s fintech sector and particularly in the capital.

Andrew Gibbon said: “Organizations are fighting for the same limited talent pool in Edinburgh and Scotland and start-ups are the ones missing out on the crucial talent they need to scale and attract new investment.

“The harder companies find it to recruit locally, the more they will turn to remote work options to fill business-critical positions. Many companies, including ePOS Hybrid, are being forced to start recruiting locally. nationwide and to offer remote work positions because candidates simply cannot be found locally.

Core-Asset’s annual review found the skills shortage was a combination of Edinburgh’s long-standing reputation as a major European financial services hub, in step with the growth of a dynamic and innovative fintech industry in which new players covered the full spectrum of fintech.

Louise Powrie, Divisional Director, Permanent Team, Fintech and Pensions with Core-Asset, said: “The boost effect of Covid-19 has resulted in an extreme stress test for the industry which, through technology, has succeeded brilliantly. The sector has proven extremely resilient to the current global crisis and is successfully emerging from the pandemic.

“Its continued growth is centered on developing tools and software solutions to address the need for more user-friendly platforms and applications, seamless data flow, AI-assisted dashboards, enhanced risk management, dynamic data management, online payments and transactions, and digital marketplace functionality.

Andrew Gibbon, ePOS Hybrid Growth Manager.
ePOS Hybrid Head of Groth, Andrew Gibbon. Founder and CEO, Bhas Kalangi Andrew Gibbon, Head of Growth

“Our report indicates a demand within fintech for business analysts and developers, particularly those with cloud technologies, and technical and solutions architects and engineers who can work with customers to truly understand their needs. and provide innovative solutions.

“The sector is well embedded in truly agile working practices and as such has continued to recruit unchallenged and will continue to do so through 2022 with remote working being the norm.”

Indeed, remote working or working from home was a theme taken up by both Origo and ePOS Hybrid and a phenomenon that will continue to grow.

“As well as being the catalyst that pushed businesses towards digital solutions, Covid has been responsible for firmly establishing working from home,” said Anthony Rafferty.

“Our initial fears at the start of the lockdown were that productivity would plummet, but the reverse has happened and working from home has really suited this part of the financial services industry. The idea of ​​recruiting only locally or within 30 minutes of Edinburgh is no longer relevant and is totally outdated.

Andrew Gibbon added: “Our difficulties in finding suitable candidates locally is by far the biggest factor limiting the company’s growth to date. Opportunities currently outstrip the talent available in all key functions, forcing companies to invest significantly more resources in finding the right candidates or looking further afield for the required skills.

The report highlights payment solutions, accounting software, and blockchain technology as common fintech solutions, but with cross-industry enterprise applications, leading to research into other skills, including legal, marketing, policy and regulatory.

The report also predicts that in 2022, one of the key industry themes will be the continued unbundling of pensions/financial services and its consolidation around a digital architecture, placing fintech at the heart of the industry.

He said: “As financial services products have begun to be unbundled and repackaged around digital architecture, the market has become more competitive and the boundary between traditional pension products and fintech services and platforms has is faded. New market entrants have imitated traditional vendors, integrating into the financial technology ecosystem, and traditional companies operate much more like technology companies.

Louise Powrie believes that as national governments and financial watchdogs introduce additional regulatory burdens, there will be opportunities for other skills, including those with experience in risk, compliance and financial crime.

She said: “This broad matrix of requirements puts pressure on the increasingly complex interplay between technology, risk, compliance and procurement functions in global businesses and financial institutions.

“Regulators in major markets are taking divergent approaches to overseeing effective risk management for fintech companies. A key challenge is determining how policies need to evolve to respond to both new market activity and traditional market activity – deploying frameworks that foster innovation, while effectively managing regulatory risks.

Each sector of activity pays particular attention to the emphasis placed on investments taking into account environmental, social and governance (ESG) considerations and fintech is no exception to this trend or to the requirements of socially responsible investment. .

“One of the key factors driving innovation in the fintech industry is the growing attention to climate change and the role of sustainable finance in meeting the immense challenge of transitioning to net zero and carbon neutral solutions. Fintech companies need to be aware of ESG compliance, especially those in the digital asset space given the energy-intensive nature of some crypto activities – and this will require candidates with specialized knowledge or interest.

Core-Asset is Scotland’s leading recruiter in the financial services sector and has access to information from thousands of candidates and top Scottish employers in the sector, which accounts for 7% of Scotland’s GDP.

Its annual salary guide is a report produced exclusively on the Scottish jobs market which compares salaries and jobs in Scotland. The data and figures produced there paint a crucial alternative picture to the usual London-centric reports.

The report highlights how Scotland continues to build its reputation as a key hub for large, globally-based investment operations firms, continuing the trend that began in the mid-1990s when firms began to relocate technically complex operational roles to Edinburgh and Glasgow.

Consulting in basic assets was established in 2005. Based in Edinburgh, it is now a £14 million business employing 22 people and working across the financial services industry, from the smallest boutiques to the biggest global players.

Initially, the firm built a reputation in the world-renowned asset management industry in Scotland. However, the success of its model has allowed it to expand across the financial services market. He now has dedicated accounting, investment operations and finance teams and also works in Scotland’s thriving legal sector.

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