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Long term competitiveness

No time to lose: Reasserting UK leadership in financial and related professional services

26 January 2026
5 minutes
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About this report

This report is based on insights drawn from engagement with over 300 senior leaders – including 70 CEOs and Chairs – from across the UK’s financial and related professional services industry, functional experts, academics, regulators, government, technology leaders, disruptors and think tanks. These perspectives have been combined with PwC’s economic modelling and international benchmarking. Together, these create an authoritative assessment of the industry’s challenges and the actions required to secure its future growth and the UK’s continued success as a world-leading international financial centre.

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The UK’s financial and related professional services industry is a strategic national asset.

Despite recent headwinds, it remains one of the largest and most productive industries in the UK:

It provides one in every 13 jobs, with two thirds of these outside London
across the country’s regions and nations

It generates more than 11% of national economic output

It contributes £12 in every £100 of tax paid

The industry plays a critical role in enabling transactions and funding and insuring national priorities across the UK, from infrastructure, defence and energy security to the growth ambitions of households and small businesses across every nation and region.

While the UK has one of the largest and most advanced domestic markets in its own right, the industry’s impact is driven by its international reach. The UK remains a world leader in fixed income, currency and commodity trading, specialty insurance, private markets, FinTech, and legal and professional services. This position of leadership has been built on strong pools of domestic skills, openness to global talent, access to deep and liquid markets, trusted and independent judiciary and regulatory institutions, and a strong focus on innovation. These key factors are all underpinned by an open and non-protectionist outlook to the world.

The UK has also developed a uniquely dense cluster of complementary capabilities across all sub-sectors, both in London and across regional and national hubs. These benefit from proximity to London’s global reach, while London relies on the scale and specialisms distributed across the nations and regions.

However, the global context in which the industry operates is now fundamentally changing and the UK cannot afford to be complacent.

In contrast to markets that are more domestically focused, the UK’s international outlook increases the industry’s exposure to geopolitical volatility, rising protectionism and regulatory fragmentation. At the same time, technologies such as artificial intelligence (AI) and distributed ledger technology (DLT) are rewiring market infrastructure and eroding long-standing advantages. Capital and talent can now move faster than ever, increasing the risk that activity migrates to financial centres acting with greater clarity, ambition and speed.

The gap between the UK and other global financial centres has already narrowed sharply: net export growth has slowed, while output and productivity have fallen in real terms since 2014. The UK must urgently act or see its leading position eroded.

If current trends persist, PwC economic modelling shows the industry shrinking as a share of the UK economy, with minimal growth and a declining share of taxes and exports. The consequences are clear: fewer jobs, weaker household wealth and diminished national resilience.

Encouragingly, recent announcements such as the Wholesale Financial Markets Digital Strategy, the new competitive frameworks for Captives and Insurance-Linked-Securities and the Consumer Duty Review already represent welcome progress. There is now strong alignment between government, regulators and industry on the need for action.

Against this backdrop, the message from industry is clear:

The UK needs to be clear about its focus and strategic position: an open, internationally connected financial centre that welcomes global firms and talent, and builds deep regulatory and market cooperation with key jurisdictions.

The absolute priority is to execute what has already been set out, faster and more decisively, and to go further where required to secure and grow the UK’s position as a leading global financial centre.

The prize for realising this is £53bn in additional economic output by 2035, equivalent to adding a city almost the size of Edinburgh and Glasgow combined to the UK economy each year.

This is equivalent to a 1.6% annual growth rate in industry Gross Value Added (GVA), alongside corresponding gains in tax revenues and exports. This would also help to stimulate the productive investment and sustainable economic growth the country needs and support the financial resilience of individuals and households across the UK.

This is the moment for the UK to move fast and to lead where it matters. Delay now risks ceding ground that may be impossible to recover. To help prioritise where action is most needed, our five imperatives for future competitiveness are underpinned by a series of recommendations to ensure their delivery. The extent of progress against these actions will shape whether the UK consolidates its leadership in financial and related professional services or continues to lose ground to faster-moving competitors.

Five imperatives for future competitiveness

If the UK is to be the top choice for global business, it must be one of the easiest and most predictable places in the world to operate, work and invest in. Industry, government and regulators must work together together to deliver these imperatives.

Lead at the frontier of financial technology

Technology is now the defining battleground for global competitiveness. Those that take the lead will win in the next era of global finance.

The UK must:

1. Lead the world in tokenised assets, prioritising financial and real-world assets, where the UK has a right to lead, and catch up on crypto and stablecoin.

2. Put digital identity at the centre of a more accessible, faster and safer financial system, anchored in protection and empowerment.

3. Fully digitise the UK’s highest friction processes, for example home purchasing and SME lending.

4. Build a tech-first workforce, focus on re-skilling, modernising certifications and attracting the world’s best talent.

5. Prepare now for the next frontier of technology, for example, the response to quantum.

Reset regulation and tax for the future of finance

The cumulative cost of compliance now outweighs the risks it seeks to mitigate. We must prepare for the next era of finance with a simpler, faster, more proportionate approach to regulation.

The UK must:

1. Streamline the rulebook, remove duplication and complexity from regulation that has built up over time, focus on principles and outcomes rather than rules.

2. Simplify, accelerate and reduce regulatory processes, for example approvals, authorisations and reporting.

3. Increase distinction between retail, business and wholesale, ensure proportionality and prepare for wholesale markets of the future.

4. Recalibrate prudential requirements and fine tune requirements to remove cliff edges and address binding constraints.

5. Give political air cover for responsible risk taking, to provide regulators and firms the confidence to innovate.

The UK tax system has become overly complex, unpredictable, is internationally uncompetitive and is not sufficiently harnessed to create the right incentives.

The UK must:

1. Restore tax predictability, provide clear, multi-year direction for the taxes that matter most to the industry.

2. Simplify the tax code and cut compliance costs, rationalise overlapping requirements and duplicative reporting.

3. Coordinate tax policy more closely with regulators and industry, establish structured, ongoing dialogue to provide earlier guidance on tax changes.

4. Ensure the tax system remains internationally competitive, with regularly review sector-specific taxes and those affecting capital and talent flows.

5. Use tax levers to reinforce strategic growth priorities, deploy targeted incentives to attract and anchor activity in high-growth areas.
Deepen international trade and investment

The industry’s strength is built on openness and international connectivity. In a more fragmented world, capital and talent are more mobile than ever.

The UK must:

1. Attract the worlds best talent to the UK, ensure fast, predictable entry routes for high-value international talent.

2. Build on our established major partnerships, particularly with the US and Europe. Adopt a pragmatic approach, aligning where it makes sense.

3. Accelerate partnership with high-growth markets with clear propositions, focused on priority markets such as India, the Middle East, ASEAN and Africa.

4. Operate as a single ‘Team UK’ for inward investment, present a coherent, joined up offer to global investors, simplifying engagement and decision-making.

5. Put digital market access at the core of trade deals, focus on secure cross-border data.

Connect capital to national priorities

Long-term savings pools are deep, but too little domestic capital is reaching infrastructure, scale-ups and strategically important sectors.

The UK must:

1. Strengthen coordination between public and private capital, scale public financial institutions and coordinate private investors around national priorities.

2. Maintain competitive incentives for growth, evolve tax and policy incentives to support early-stage and scale-up investment.

3. Recalibrate prudential frameworks, to better reflect the true risk of long-term, mission-critical projects such as energy and defence.

4. Build cross-sector expertise, enable talent rotation and share capability to improve project delivery and capital deployment.

5. Unblock finance for SMEs, to enable growth and investment across the UK.

Build a nation of investors

Low participation in investing weakens household resilience, shrinks domestic capital markets and increases reliance on overseas capital.

The UK must:

1. Ramp up financial education for life, equip people with the confidence and skills to engage.

2. Expand access to advice, accelerate delivery of reforms and use technology to personalise engagement while maintaining strong consumer protection.

3. Simplify tax and product incentives for investing, make investing simpler, and align tax incentives clearly with long-term goals.

4. Cut complexity in consumer communications, replace dense, defensive disclosures with clear, balanced information.

5. Accelerate product and process innovation, learn from leaders in other countries to develop simple, digital-first investment products and journeys.

The actions outlined in this report are mutually reinforcing. Greater efficiency in regulation and tax creates the space for innovation; innovation expands participation by lowering barriers and improving access; broader participation deepens markets, builds resilience and scale; and scale, in turn, drives further efficiency. Together, these steps can unlock a step change in competitiveness, strengthen national resilience and deliver material downstream benefits across every sector the industry touches.

If the UK seizes this moment and delivers on the key imperatives outlined in this report the upside is considerable. PwC’s economic modelling estimates that the industry could generate up to £53bn in additional economic output by 2035. This is equivalent to a 1.6% uplift in national GVA beyond the base case, alongside corresponding gains in tax revenues and exports. This secures jobs across the country, strengthens household wealth creation, enhances access to capital for small businesses and supports growth in the sectors that depend on a competitive financial and related professional services system.

Success now depends on clarity, confidence and credibility in delivery. The UK must be prouder and clearer about what its financial and related professional services industry delivers: its global reach, its deep expertise, and its ability to drive growth and finance the everyday economy. The UK remains a place where world-class talent, ideas and capital converge. Reasserting that story at home and abroad is essential to stimulating the productive investment and sustainable economic growth the country needs, and supporting the financial goals and resilience of individuals and households across the UK.

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