The UK has suffered from problems of under-investment and low productivity growth for a long time. This lack of investment and growth constraints how much money people are paid, how much money can be raised in taxes to pay for public services and the overall wealth of the UK population. The UK has experienced a large increase in the number of small firms in the economy over the last fifty years. As a result, around 60% of the working population rely on the small business sector for their jobs, incomes and well-being. A big concern, that has been around since the 1930s is that small firms may struggle to access loans from banks and investment from investors. For many reasons, there is a significant gap in our current knowledge about the contribution of smaller firms to the overall performance of the UK economy and specifically how their ability to access finance influences how they contribute to productivity. To fully understand how the 6 million small firms in the UK contribute to economic growth, this project helps researchers to understand more about small firms that are owned and managed by entrepreneurs. It explores how these entrepreneurs have personal preferences and talents that shape how their firms operate and explore potential opportunities for new investment that might lead to productivity-enhancing growth. When small firms have opportunities to invest, it then faces choices about how to fund these new investments. Many small firms have a strong dislike for external finance and choose to limit their investments to ones they can fund from their own resources. Others seek external debt, often bank loans, but are refused. Others get bank loans, but only get a fraction of the amount they requested. All of these scenarios potentially lead to an under-investment in productivity enhancing growth. This research project traces out the whole process from the small, entrepreneurial firm, to their investment opportunities and funding choices, and then examine how, when and where this process can lead to productivity growth. The project explore the chain of events in great detail and cover the full range of investment opportunities and potential sources of finance. This includes looking at bank debt, government guaranteed loans, "Peer-2-Peer" lending, Alternative Lenders, FinTech, right through to more sophisticated equity finance. This broad overview allows the project to establish, at each step in the causal chain of events, what types of firm face the greatest barriers to progression onto the next stage which ultimately end up with new investment and productivity growth. Specific points of focus within this chain of events will be on the identification of differences by (a) regions and place, (b) firms of different sizes, (c) firm of different ages, (d) differences by industry, and (e) patterns of innovation. The project builds a nuanced picture of the problems that small firms face accessing investment capital and increasing their productivity that will give policy-makers and businesses themselves the evidence to support a mutually beneficial and co-ordinated response to address these problems that may ultimately benefit the 6 million UK small business owners and their 16.8 million employees and their families.

The UK has suffered from problems of under-investment and low productivity growth for a long time. This lack of investment and growth constraints how much money people are paid, how much money can be raised in taxes to pay for public services and the overall wealth of the UK population. The UK has experienced a large increase in the number of small firms in the economy over the last fifty years. As a result, around 60% of the working population rely on the small business sector for their jobs, incomes and well-being. A big concern, that has been around since the 1930s is that small firms may struggle to access loans from banks and investment from investors. For many reasons, there is a significant gap in our current knowledge about the contribution of smaller firms to the overall performance of the UK economy and specifically how their ability to access finance influences how they contribute to productivity. To fully understand how the 6 million small firms in the UK contribute to economic growth, this project helps researchers to understand more about small firms that are owned and managed by entrepreneurs. It explores how these entrepreneurs have personal preferences and talents that shape how their firms operate and explore potential opportunities for new investment that might lead to productivity-enhancing growth. When small firms have opportunities to invest, it then faces choices about how to fund these new investments. Many small firms have a strong dislike for external finance and choose to limit their investments to ones they can fund from their own resources. Others seek external debt, often bank loans, but are refused. Others get bank loans, but only get a fraction of the amount they requested. All of these scenarios potentially lead to an under-investment in productivity enhancing growth. This research project traces out the whole process from the small, entrepreneurial firm, to their investment opportunities and funding choices, and then examine how, when and where this process can lead to productivity growth. The project explore the chain of events in great detail and cover the full range of investment opportunities and potential sources of finance. This includes looking at bank debt, government guaranteed loans, "Peer-2-Peer" lending, Alternative Lenders, FinTech, right through to more sophisticated equity finance. This broad overview allows the project to establish, at each step in the causal chain of events, what types of firm face the greatest barriers to progression onto the next stage which ultimately end up with new investment and productivity growth. Specific points of focus within this chain of events will be on the identification of differences by (a) regions and place, (b) firms of different sizes, (c) firm of different ages, (d) differences by industry, and (e) patterns of innovation. The project builds a nuanced picture of the problems that small firms face accessing investment capital and increasing their productivity that will give policy-makers and businesses themselves the evidence to support a mutually beneficial and co-ordinated response to address these problems that may ultimately benefit the 6 million UK small business owners and their 16.8 million employees and their families.

AI technologies have the potential to unlock significant growth for the UK financial services sector through novel personalised products and services, improved cost-efficiency, increased consumer confidence, and more effective management of financial, systemic, and security risks. However, there are currently significant barriers to adoption of these technologies, which stem from a capability deficit in translating high-level principles (of which there is an abundance) concerning trustworthy design, development and deployment of AI technologies ("trustworthy AI"), including safety, fairness, privacy-awareness, security, transparency, accountability, robustness and resilience, to concrete engineering, governance, and commercial practice. In developing an actionable framework for trustworthy AI, the major research challenge that needs to be overcome lies in resolving the tensions and tradeoffs which inevitably arise between all these aspects when considering specific application settings.For example, reducing systemic risk may require data sharing that creates security risks; testing algorithms for fairness may require gathering more sensitive personal data; increasing the accuracy of predictive models may pose threats to fair treatment of customers; improved transparency may open systems up to being "gamed" by adversarial actors, creating vulnerabilities to system-wide risks. This comes with a business challenge to match. Financial service providers that are adopting AI approaches will experience a profound transformation in key areas of business as customer engagement, risk, decisioning, compliance and other functions transition to largely data-driven and algorithmically mediated processes that involve less and less human oversight. Yet, adapting current innovation, governance, partnership and stakeholder relation management practice in response to these changes can only be successfully achieved once assurances can be confidently given regarding the trustworthiness of target AI applications. Our research hypothesis is based on recognising the close interplay between these research and business challenges: Notions of trustworthiness in AI can only be operationalised sufficiently to provide necessary assurances in a concrete business setting that generates specific requirements to drive fundamental research into practical solutions, with solutions which balance all of these potentially conflicting requirements simultaneously. Recognising the importance of close industry-academia collaboration to enable responsible innovation in this area, the partnership will embark on a systematic programme of industrially-driven interdisciplinary research, building on the strength of the existing Turing-HSBC partnership. It will achieve a step change in terms of the ability of financial service providers to enable trustworthy data-driven decision making while enhancing their resilience, accountability and operational robustness using AI by improving our understanding of sequential data-driven decision making, privacy- and security- enhancing technologies, methods to balance ethical, commercial, and regulatory requirements, the connection between micro- and macro-level risk, validation and certification methods for AI models, and synthetic data generation. To help drive innovation across the industry in a safe way which will help establish the appropriate regulatory and governance framework, and a common "sandbox" environment to enable experimentation with emerging solutions and to test their viability in a real-world business context. This will also provide the cornerstone for impact anticipation and continual stakeholder engagement in the spirit of responsible research and innovation.