Welcome to Fintech for CFOs, Papaya Global’s newsletter for CFOs and finance teams. We source and summarize the week’s most relevant fintech stories – so you don’t have to.
Here are the three things you need to know this week:
AI is heading to finance teams. Here’s how risk-averse CFOs can adapt – WSJ
- For risk-averse accountants and chief financial officers, change can be hard. But artificial intelligence and other advanced technologies are coming, and financial officers who don’t adapt may find themselves left behind.
- Half of all new employees in corporate finance functions will have backgrounds outside finance or accounting by 2026, thanks to the rise of AI and automation.
- While AI technology is in its early stages in the finance function, it can be especially useful for budgeting and forecasting, saving a lot of time.
- The pandemic has motivated companies to adopt more fintech, such as Bank of America’s CashPro app, which processed $655bn last year.
How London lost its lustre for fintechs – Financial Times ($)
- Despite positive government talk about UK fintech and the launch of a review into the sector by Prime Minister Rishi Sunak, the country is losing its reputation as a centre of fintech innovation, with many fintechs seeking greater financial support and reforming listings.
- Changes to flagship UK policies like the research and development tax credit mean that fewer startups will qualify for help, further reducing London’s appeal to founders.
- Additionally, the UK’s departure from the EU has brought uncertainty and stymied growth in the sector.
- SVB UK, a branch of the failed US bank that specialised in fintech, has recently been sold to HSBC for £1, sparking concerns about how well the different risk appetites and backgrounds of the two banks will integrate.
Business confidence bounces back for CFOs – Deloitte
- Optimism is rising among finance leaders of the UK’s largest firms. A net 25% of CFOs are more optimistic about their businesses’ financial prospects than they were three months ago, according to Deloitte’s UK CFO Survey for Q1 2023.
- CFOs’ perceptions of external uncertainty have fallen at the fastest pace since 2010, with Brexit and energy risks easing, and CFOs now rate external uncertainty at levels far below previous peaks.
- CFOs expect a significant growth in capital spending on artificial intelligence (AI) over the next five years, with the majority believing that AI will help raise UK productivity, but they are divided on its impact on jobs within the workforce
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