Fraser Stewart, Co-Founder and CCO of Lyfeguard, shares his insights on the upcoming UK election’s potential impact on financial services, particularly for individuals and businesses managing their finances. In this interview, Stewart discusses key issues such as R&D tax credits, open finance regulations, SME support, the digital skills gap, and the UK’s position in the global economy. As a leader in financial technology, Stewart offers a unique perspective on the challenges and opportunities facing the sector in light of potential political changes.
If we see a new government this week, what’s the one big change you’re hoping for that could really benefit businesses in your sector.
The recent changes to R&D tax credits threaten to stifle innovation and hinder the growth of UK businesses. By limiting relief on expenditures for overseas subcontractors and externally provided workers, the government risks undermining the global nature of R&D in the tech sector. Data from the Office for National Statistics reveals that overseas expenditure accounts for a significant portion of R&D claims, potentially amounting to £21.6 billion. This underscores the importance of international collaboration and the reliance of UK businesses on global expertise. To foster a thriving innovation ecosystem, the government should reconsider these restrictions and allow for tax relief on overseas R&D activities. This would empower UK businesses to access global talent, drive innovation, and maintain competitiveness on the international stage.
There’s always talk about cutting red tape. What’s a regulation you think needs a fresh look, and how would you like to see it changed?
The UK led the way with Open Banking and revolutionising financial services, giving consumers control and fuelling innovation. Now, the Data Protection and Digital Information Bill offers a chance to expand this model through Open Finance. This means secure, standardised data sharing across pensions, investments, and more. Consumers gain transparency and choice, while providers compete to offer better products and services. This isn’t just about cutting red tape – it’s about using a proven framework to empower consumers, drive competition, and create a more transparent financial landscape.
We keep hearing about plans for boosting the economy. What kind of support or initiatives do you think would actually make a difference for businesses like yours?
SMEs are the driving force of the UK economy, representing over 99% of all businesses. However, many struggle to access the finance needed to grow and innovate. To truly boost the economy, we need targeted support that addresses this fundamental challenge. Expanding loan guarantee schemes, simplifying credit application processes, and promoting alternative financing options like crowdfunding and peer-to-peer lending are crucial steps. By making capital more accessible, we can empower SMEs to invest, expand, and create jobs, ultimately driving economic prosperity for all.
Skills and workforce are hot topics. What’s your take on the current situation, and what would you tell the new PM needs fixing first?
The widening digital skills gap, costing the UK an estimated £63 billion annually, poses a significant threat to our economic future and requires urgent action. Firstly, significant investment in accessible, high-quality digital skills training programs is essential. This includes expanding apprenticeships, offering subsidised courses, and partnering with businesses to provide on-the-job training opportunities. Secondly, the education system must be modernised to foster digital literacy from a young age. This involves updating curricula, training teachers in digital skills, and integrating technology into classrooms to equip students for the digital age. Finally, recognising the global nature of the tech industry, the PM should consider measures to attract and retain international tech talent. Streamlining visa processes for skilled tech workers and creating incentives for global tech companies to establish a UK presence can help fill immediate skills gaps and foster a thriving tech ecosystem.
With all the global uncertainty, how do you think a change in government might affect UK businesses on the world stage? Any opportunities you’re eyeing?
In the face of global uncertainty, UK businesses can find stability and opportunities through international cooperation. Regardless of the political landscape, fostering strong relationships with global partners and actively addressing shared challenges is crucial for long-term success.
By working collaboratively to reduce geopolitical tensions, mitigate climate change, and promote equality, the UK can contribute to a more stable and prosperous global environment. This, in turn, benefits UK businesses by opening new markets, enhancing supply chain resilience, and creating a more predictable landscape for international trade and investment. By prioritising global cooperation, the UK can position itself as a responsible leader on the world stage, while also securing a brighter future for its businesses in an increasingly interconnected global economy.
The convergence of tech and brands 