The UK agency established to foster fintech innovation, which has been particularly active around Open Banking, has partnered with Lloyds Bank and Mastercard to fund its next coalition.
The Centre for Finance, Innovation and Technology (CFIT) plans to launch its next coalition this quarter, with the UK’s extensive network of 5.6 million SMEs as the core focus. The body hopes to build on the work of its SME Finance Taskforce and development of an SME resilience index, used to inform decision making.
Pledging support for the initiative, Lloyds and Mastercard will join CFIT’s plans to develop SME-focused solutions such as a digital finance education tool, a digital marketplace and a supply-side proof of concept.
Charlotte Crosswell, Chair of CFIT, said: “This new strategic agreement with industry partners positions CFIT strongly for its next phase of growth, and is testament to the success of our coalition-led approach to date.
“We are grateful for the support of Mastercard and Lloyds Bank and look forward to welcoming more strategic and coalition partners to further advance the progress we’ve already made on SME Finance. We are also working closely with industry on other key projects for 2025, such as smart data schemes in financial services and delivering more inclusive financial service propositions.
“This agenda is closely aligned with the government’s Industrial Strategy, National Payments Vision and ambitions – including manifesto commitments – on Smart Data, and especially Open Banking and Open Finance. All of which will be crucial to helping the UK regain its leadership in financial services innovation and fintech amidst intensifying global competition.”
CFIT was created in 2023 with the backing of the then-Conservative Party government, tasked with removing barriers to financial innovation in UK business. Finance is a core segment of the UK economy, accounting for around one-tenth of GDP, and SMEs, as with other sectors, make up the bulk of companies active within it.
Following the change in government in July, the new Labour administration has been trying to achieve its goals of being a ‘party for business’, including support for SMEs. CFIT’s SME focus falls within the government’s remit; its aforementioned SME Taskforce has made recommendations on how the government can better support small businesses.
As SMEs are often core clients for larger multinational companies like Lloyds, one of the UK’s biggest banks, and Mastercard, one of the world’s two biggest payments processors alongside Visa, these firms’ keenness to engage with CFIT in this regard is unsurprising.
“SMEs play an essential role in our communities, providing services and creating jobs,” remarked Elyn Corfield, CEO of Business and Commercial Banking from Lloyds Bank.
“By entering into a strategic partnership with CFIT for this next coalition, we aim to accelerate the development of the SME finance market, creating smart-data-driven solutions that help SMEs access appropriate funding.
“If we can improve awareness of different financial options and increase the number of SMEs applying for suitable finance so that they can invest in their infrastructure, products and services, they can better play their vital role in boosting UK growth.”
CFIT’s planned SME coalition follows on from the work of its aforementioned SME Taskforce, which came to some notable conclusions around smart data – as explained by Croswell in an op-ed for Payment Expert last year.
The coalition will also build on previous coalitions focusing on Open Finance and Economic Crime. Again, these coalitions fall within the scope of overarching economic and regulatory trends in the UK.
Both Conservative and Labour governments have shown enthusiasm for greater adoption and development of Open Banking in the UK, seeing it as key to driving the country’s economy forward. Meanwhile, economic crime like fraud has been causing a headache for regulators as well as countless businesses and consumers.
The addition of key UK finance industry players like Lloyds and Mastercard to CFIT’s next coalition will come as reassuring to both the organisation and Keir Starmer’s government, which is betting heavily on financial services and innovation to UK economic growth at a time of slowdown.
