Financial Services Growth and Development Board minutes: March 2024

Minutes from the meeting of the group on 21/02/24

Attendees and apologies


  • Mairi McAllan MSP, Cabinet Secretary for Wellbeing Economy, Net Zero and Energy
  • Sue Dawe, SFE
  • Sandy Begbie, SFE
  • Nicola Anderson, FinTech Scotland
  • Angus MacPherson, Noble Group
  • Koral Anderson, Barclays Group
  • Vida Rudkin, Morgan Stanley
  • Louisa Knox, Shepperd and Wedderburn
  • Claire Reid, PWC
  • Alastair Ross, ABI
  • Stephen Bird, abrdn
  • David Ritchie, SNIB
  • Jackie Leiper, Lloyds Banking Group
  • Sheriff Alastair King, City of London
  • Jane Martin, Scottish Enterprise
  • Nick McGruer, FCA
  • Chris Hayward, City of London


  • Humza Yousaf MSP, First Minister
  • Richard Lochhead MSP, Minister for Small Business, Innovation, Tourism and Trade
  • John McGuigan, SFE
  • Judith Cruickshank, RBS
  • Gerry Mallon, Tesco Bank
  • Andy Curran, Phoenix Group
  • Barry O'Dwyer, Royal London
  • Arleen Arnott, KPMG

Scottish Government:

  • Andrew Hogg
  • Kim Mackay
  • Jason Dashti

Items and actions

Welcome (item 1)

The Cabinet Secretary for Wellbeing Economy Net Zero and Energy opened the meeting by welcoming members and guests, and extending the First Minister’s apologies.

The Cabinet Secretary provided an overview of her new portfolio highlighting it was the first time economy has sat alongside energy and net zero which signals intent and future direction of travel, as well as alignment with the priorities of the financial services sector. She also stressed the Scottish Government’s ambition to build a fair, green and growing economy, to grow GDP alongside the health and wellbeing of people and the environment, and that tackling climate change is a moral obligation.

Actions from September 2023 meeting (item 2)

Sue Dawe gave apologies on behalf of John McGuigan.

Sandy Begbie provided an update on the actions from the last meeting in September 2023:

  • Action 1: Co-ordinate group to investigate investible projects in Scotland and how to capture available pensions investment with a particular focus on the challenge of heating buildings/decarbonisation. To be covered in agenda item 3.
  • Action 2: First Minister to be provided with further detail on Smart Data Foundry's East Renfrewshire Council's pilot "enabling data driven decision making".  Completed.
  • Action 3: Future agenda item of FISGAD to explore data and how the sector and government can be better connected across data - with particular regards to the detection and support of vulnerable consumers. To be covered as an agenda item at a future meeting.
  • Action 4: Co-ordinate group to investigate the complex benefits landscape and explore how this can be made simpler for individuals to navigate to ensure all entitled benefits are being claimed. To be covered in agenda item 4.

SFE Growth Strategy for Financial Services in Scotland (item 3)

Chris Hayward (guest) provided an overview of the City of London Corporation’s role, the roles of Lord Mayor of London and Policy Chair and their recently published Vision for Economic Growth. He also noted that Alistair King (member) will be the next Lord Mayor of London strengthening connections between the organisation and Scotland.   

Sandy Begbie presented an update of the SFE Growth Strategy for Financial Services in Scotland and spoke about the collaborative effort to launch the growth strategy at the end of last year. He highlighted that the last 12 months has been mixed for the industry, particularly in asset and wealth management. Despite this, TCUK reported an increased number of roles in the sector in Scotland. 

SFE believes that financial services is one of the few sectors that can grow at scale quickly and their ambition is to add another £4-7 billion in the next 5 years. The key to achieving this is working together to ensure alignment across the ecosystem to deliver growth with purpose and to focus on 3 or 4 key areas: people, cost of doing business, universities and way of life.  

The group discussed ways to achieve this including:

  • The need for skills development, particularly in AI and data, with more collaboration and engagement with the university sector. 
  • Connecting opportunities and existing activity like the GEFI summit to involve more investors for offshore wind and renewables.
  • Innovation strategy including the work of Fintech Scotland Roadmap and FRIL and how critical it is to build test spaces to enable trial and testing, to make and learn from mistakes, and importance of embedding support to commercialise research.
  • Overseas activity to attract new business and jobs to Scotland.

SFE have also identified some key risks including further divergence of tax from the rest of the UK and the sustainability of university funding for domestic Scottish students. Sue Dawe asked for members views on the risks identified, particularly tax. Members raised the following points:

  • Senior talent have choices and are raising disparity of compensation in Scotland vs rUK/London.
  • Divergence can create uncertainty and increase risk for long term investment decisions. 
  • SFE are currently running a survey to get qualitative and quantitative data on this topic which they will share with SG.

The Cabinet Secretary stressed that the Scottish Government did not make decisions on tax lightly when setting the budget which was the most challenging in recent years. These were necessary to deliver an economic model with high standards of public services and would like to think that people would choose Scotland because of that economic model. However, she does recognise the risks identified and the importance of continuity.

Members agreed to maintain a regular dialogue on this topic.

A comment was raised about Asian models where there is a low rate of taxation but use of technology to drive efficient spending. The Cabinet Secretary welcomes suggestions on how government can make money go further and highlighted current work on public sector reform to drive efficiency. She offered to bring an update on this to a future meeting.

Financial Inclusion (item 4)

Sandy Begbie provided an overview of current work across partners, firms and charities on addressing the issue of the high unbanked population in Scotland, including exploring ideas to automatically provide all school leavers with a bank account. Sandy confirmed that they would appreciate engaging with the Minister for Education on this highlighting that this was something the First Minister also indicated an interest in exploring further.  

Nick McGruer confirmed the importance for the FCA of purposeful interaction in Scotland and are keen to get behind this, noting that the number of unbanked is higher in Scotland than in the rest of the UK. Therefore it is important to understand the differences and the FCA can provide data and ways to overcome barriers through innovation. The Financial Inclusion TechSprint is looking at this in partnership with Fintech Scotland with the launch on 30 May in Glasgow.

Nicola Anderson confirmed that the Techsprint has 13 participants including large financial institutions, collaborating with a focus on enabling the environment to find solutions to address access to bank accounts but also mainstream credit. Access to the right data is critical to drive success if innovators are going to thrive including public, industry and charity data.

The group discussed existing support across banks to provide basic bank accounts but note that it is a challenge to get people into system with most referrals coming through social services or third sector. So support is there but need to identify why not more referrals. It was also noted that challenger banks are not currently involved and also recognition that some of the reasons behind the unbanked are cultural.

The group discussed whether there is value in running a regional pilot in schools but acknowledged a need to work with SG Education departments whilst also recognising that schools are under a lot of pressure. Most of the banks already deliver financial literacy and life skills training across c80% of schools and could perhaps do more to signpost. There was also an acknowledgement that it is an issue identifying and verifying school leavers and perhaps there is a need to use a regulatory sandbox to support innovation to address this as part of a pilot.  

The link with poverty challenges was also discussed noting that basic bank account holders are not always aware of all the benefits available to them. 

The group agreed to convene a smaller group to discuss this further. 

Economic Update (item 5)

Sandy Begbie provided the economic update, based on insights received from the banks. He raised the following points:

  • Banks are not hitting targets for lending due to a reluctance from customers to take on new debt. Business investment is soft at the moment.
  • Requests from support from specialised units in the bank are continuing at normal levels indicating that stresses in economy have still not turned into an uptick of business and consumers in distress.
  • Defaults are lower than pre-covid and, although offset by low unemployment data, healthy deposits continue for individual and business customers.  
  • Skills and human capital was a key issue during covid and the last 6 months has seen a softening of firms being unable to hire. Banks are reporting that this is not as significant an issue except in some pockets e.g. hospitality and rural. 
  • SMEs are not engaging on climate issues and reports indicate that some are concerned primarily about whether they will still be in business in 12 months’ time.  It is seen as a cost, not an investment, and many don’t see commercial value. Many also don’t have the required expertise or funds to address climate issues within their business.

Points raised by the group included a concern that there is a fundamental issue with SMEs investing which is a long standing issue in Scotland that needs to be addressed.  Although previous actions have had some success, there is a need to have an integrated plan and identify what needs to be done to intervene.  It was also highlighted that if we want an economy that will support public services we need to re-establish growth at higher levels. This requires us to be competitive internationally not just locally, and therefore we should be concerned about the risks raised by SFE because these are at the heart of our ability to attract and retain talent that is globally competitive.


  • Convene a separate group to explore options to address unbanked population in Scotland including offer of bank account to all school leavers. 
  • SG officials to liaise with Cabinet Secretary’s Private Office regarding Ministerial attendance at FCA TechSprint in May
  • SG officials to liaise with Cabinet Secretary’s Private Office regarding sponsoring a parliamentary reception focussed on financial inclusion later this year
  • SG officials to connect SFE/FISGAD with the Cabinet Secretary for Education and Skills as part of work on the idea of bank accounts for school leavers.
  • Cabinet Secretary to provide an update on public reform work at a future meeting.
  • Cabinet Secretary, Scottish Ministers and Scottish Government officials to provide ongoing leadership, support and engagement in the recognition of the financial services sector’s importance to Scotland, and in the promotion of the sector and their ambitions for continued growth.
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