UK trade with Ireland faced significant growth between 1999 and 2018 registering £ 2.9 billion and £13.5 billion respectively, according to a briefing paper Statistics on UK trade with Ireland published on January 14, 2020, by the House of Commons Library. In 2018, Ireland was the UK’s 5th largest export market and the 10th largest source of import. A no-deal Brexit will have serious impacts on the UK-Irish trade. Brexit has serious economic implications for both countries. The UK has kept the British pound, while Ireland uses the Euro as local currency. According to Irish Tech News, the pound lost 10% immediately after Brexit vote. Traditional banks offer poor exchange rates. Thus, entrepreneurs are facing a huge loss while facing currency exchanges and traditional bank fees.
After Brexit, Financial technology is considered a game-changer for UK-Ireland trade. Fintech Currency direct, a UK based exchange company will allow entrepreneurs to get the best exchange money rate. A reliable and safe tool that will allow people to transfer money online, over the phone, or the app. The minimum amount they can transfer is £100 or €100.
Ebury, a London based Fintech startup that provides foreign exchange, money transfer, and other currency services to more than 43000 small and medium businesses secured £350 million in late 2019. With an Ebury account, clients can exchange money with no boundaries. Another Fintech acquired by Ebury is Frontierpay- specialized in International payroll solutions.
The UK Fintech-State of Nation report states that there are 1600 Fintech Firms in the UK. The report estimates more than a double growth by 2023. On the other hand, Ireland is taking advantage of the Brexit to establish itself as a key area for Fintech. According to Fintech Global, Ireland’s FinTech exports have increased by 17% in 2018 to €829m.
On June 10, 2020, and during the launching of the Future Tech Trade Strategy at London Tech Week Liz Truss, UK International Trade Secretary said, “thanks to the tech industry for all their brilliant work keeping jobs going, keeping business going, keeping trade going, at this really difficult time for the economy”. Truss announce the future Fintech strategy with four major categories: Free trade agreements, digital trade network, supporting UK exporters, and Encouraging tech investment across the UK.
While the UK’s decision to exit the European Union is a double-edged sword, nurturing a fintech ecosystem with Ireland will boost technological innovation and economic growth.