Financial Services Ireland (FSI), representing Ireland’s financial services sector, has urged the government to establish a dedicated physical space for fintech firms.
At the association’s annual dinner, FSI Chairman Joe Heneghan emphasized the evolving nature of financial services, stating, “As consumer appetite for digital services continues to grow, every firm operating in financial services is now a fintech firm.” The proposed fintech hub aims to be a vibrant center for innovation, collaboration, and growth, fostering an open ecosystem where fintechs, industry incumbents, and regulators can exchange ideas.
Regulatory support and funding challenges
Heneghan highlighted the importance of the fintech hub in delivering jobs, growth, and investment for Ireland.
The call for a dedicated space aligns with the recent announcement by the Central Bank of Ireland to establish a regulatory sandbox, providing a safe space for firms to experiment. However, this plea comes against the backdrop of a decline in funding for Irish fintechs.
A KPMG report cited rising interest rates, inflation and geopolitical tensions as contributing factors to the reduction in fintech funding in the first half of 2023.
FSI’s push for state support
Financial Services Ireland (FSI) has been a vocal advocate for increased state support for the fintech sector.
A September survey conducted by the association revealed that 72 percent of respondents believed there was insufficient funding for innovation, while 64 percent expressed concerns about inadequate support for growth. The sector faces challenges that extend beyond funding, and FSI’s call for a national fintech hub is part of a broader effort to strengthen the industry’s foundation in Ireland.
Fintech in Ireland
As Ireland develops the evolving landscape of fintech, the call for a national hub reflects the industry’s need for a collaborative space to drive innovation and overcome funding challenges. While awaiting the government’s response to this plea, some financial institutions have taken matters into their own hands.
BNY Mellon, for instance, announced plans to invest €8 million in a digital R&D hub in Dublin, focusing on AI and data analytics. As the fintech sector seeks to adapt and thrive, the establishment of a dedicated hub could be a pivotal step in positioning Ireland at the forefront of fintech innovation.