Former Chancellor Lord Philip Hammond has been appointed to the advisory board of the provisionally named Fintech Growth fund, a £1bn venture to invest in financial technology startups, according to reports.
Sources told Sky News on Monday that Lord Hammond, who served as chancellor under former Prime Minister Theresa May from 2016 to 2019, would be one of several big-name figures to work with the fund.
The establishment of the Fintech Growth Fund was one of the recommendations that came from the landmark ‘Kalifa Review’, a government-commissioned examination into the UK fintech sector from former Worldpay executive Sir Ron Kalifa.
Kalifa recommended £1bn of institutional capital to be put toward closing the “£2bn fintech growth capital funding gap”, acting as a “catalyst in developing” growth in the industry.
Among the potential sources of funding mentioned by Kalifa was the “£6tn in UK private pension schemes”.
The focus of the fund will be providing late-stage funding for UK fintechs looking to scale up with big investments beyond the Series B round.
Kalifa noted in his recommendation a concerning pattern of UK fintech entrepreneurs selling their companies at the first signs of growth, rather than developing them within the UK.
The review’s one-year anniversary in February of this year prompted industry experts to call on the government to do more to ensure the UK retained its “fintech crown”.
Investment in UK fintech startups hit a record £8.6bn in 2021, the highest of any tech sector and outpacing the rest of Europe.
A number of high-profile companies have reportedly been approached to provide seed funding to help launch the venture vehicle, including Barclays, Mastercard, and the London Stock Exchange Group (LSEG).
Sources also said an official announcement was being prepared for as early as autumn this year.
Other figures expected to be involved are Phil Vidler, a former Treasury official and CEO of Fintech Alliance, and Al Lukies, a former long-term government ambassador for fintech.
UKTN has contacted Lord Hammond for comment.