UPDATE 1-Britain's digital finance firms under pressure after banking turmoil, execs say

(Adds investor comments) By Iain Withers and Elizabeth Howcroft LONDON, April 17 (Reuters) - Digital finance firms in Britain will find it tougher to raise funds due to higher interest rates and investor caution after the collapse of U.S.-based technology lender Silicon Valley Bank (SVB), executives told an industry event on Monday. The Bank of England has raised interest rates 11 times since December 2021 in a bid to curb soaring inflation, which has squeezed living standards. However, the hikes have also led to higher funding costs for companies. "The bar on capital has been raised, from an era where there was (effectively) 0% interest rates and relatively easy access to cash and capital," said TS Anil, CEO of British digital bank Monzo, speaking at the Innovate Finance conference in London. Anil said last month's banking sector turmoil, sparked by the failure of SVB which spooked investors, could contribute to a broad shake-up in the digital finance sector. Britain's digital banks will need support over the next few months to help them cope with the market fallout from SVB's demise, trade body Innovate Finance warned last month.

Tim Levene, CEO of fintech-focused investment company Augmentum, told the event there was likely more pain to come and start-ups would take further hits to their valuations.

"We're going to see stories over the next 12 months of businesses that have failed, but that's part of venture (capital)," he added.

The Bank of England is considering an overhaul of its deposit guarantee scheme, which could include boosting the amount covered for businesses if lenders hit trouble, The Financial Times reported on Sunday. "The Bank of England looking at the regulations... is the sensible course to do," Sam Everington, senior executive at British digital bank Starling, told the event in London.

Digital finance company bosses said they were confident the sector could weather tough economic conditions, but that pressure was building on business models. Lisa Jacobs, CEO of fintech Funding Circle, said much of the digital finance industry had only ever known low interest rates, but she was confident the industry could still show its value.

(Reporting by Iain Withers and Elizabeth Howcroft; Editing by Sinead Cruise, Sharon Singleton and Ed Osmond)

Reuters

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

off-the-wire

UPDATE 1-Britain's digital finance firms under pressure after banking turmoil, execs say

By Reuters

Reuters

Reuters

Gold is never going back to $2,000: 'That's history,' prices to 3x from here – Peter Schiff

‘Biggest economic shift since Nixon’: Major U.S. monetary policy changes coming in 12-36 months – Jack Mallers

Solid price gains for gold, silver after busy news weekend

India joins South Africa in denying BRICS currency plans after Trump’s 100% tariff threat

Silver prices breach $32/oz as bullish technicals and fundamentals suggest potential breakout

off-the-wire

UPDATE 1-Britain&apos;s digital finance firms under pressure after banking turmoil, execs say

By Reuters

Reuters

Reuters

UPDATE 1-Britain's digital finance firms under pressure after banking turmoil, execs say