A £1bn fund aimed at filling the 'funding gap' for fintech companies is starting to attract high-profile backers.
The fund, first mooted in a report for Prime Minsterial hopeful Rishi Sunak last year, has enlisted former chancellor Philip Hammond to its advisory board.
FinTech Alliance boss Phil Vidler and entrepreneur Al Lukies are also expected to be brought on board, Sky News reported.
The Fintech Growth Fund is expected to raise capital from institutional investors such as pension providers, insurers and banks and would act independently from government.
The fund's backers have reportedly sought seed funding from institutions such as Barclays PLC (LSE:BARC) (Barclays PLC (LSE:BARC)), Mastercard Inc (NYSE:MA) (Mastercard Inc (NYSE:MA)) and the London Stock Exchange Group PLC (LSE:LSEG) (London Stock Exchange Group PLC (LSE:LSEG)) for a vehicle that would invest in fintech companies looking for Series C funding or beyond.
The idea for the fund originated in a government-led review of the fintech industry last year - written by former Worldpay (LSE:WPG) (Worldpay (LSE:WPG)) boss Ron Kalifa.
The report recommended unlocking institutional capital “to create a £1bn ‘Fintech Growth Fund’ of sufficient scale to act as the catalyst in developing a world leading ecosystem”.
Kalifa’s report cited a £2bn funding gap among early-stage fintech companies in the UK, outlining an opportunity to tap into £6trn of pension capital that could be used to help these companies grow.
“Many entrepreneurs prefer to sell rather than continue to build their promising company,”