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In particular, the FCA is concerned that the regulatory standards may suffer in the struggle between different jurisdictions for the financial and technological business. This is especially with regard to the number of normative "sandboxes" used by various supervisory authorities, each of which has its own rules and Standards.
These concerns were voiced by Christopher Woolard, FCA Strategy and Competition Director, at the International Innovate Finance Global Summit, held in London on Monday.
Great Britain became the first country to introduce an incubator for fintech startups in 2015. The organization provides banks and start-ups with a "safe environment" for testing new products and services without standard regulatory restrictions.
This approach has later been adopted by other jurisdictions. In this connection, Woolard expressed his fears about a possibility of the emergence of the so-called Wild West, which "will impede our ambitions" and threaten "deterioration of results for consumers."
"We also believe that an incubator, which is unable to prepare a company for entering the regulated market, will not contribute to emergence of successful firms in the long term", Woolard added. "In addition, we are noting potential risks to reputation and confidence in financial innovations, if we witness examples of global failures in the future."
The FCA recognizes that there is hardly any single standard that is suitable for everyone, but providing a "common understanding and closer international cooperation" in the field of innovation "will help to guarantee the future of the industry in the long term." Woolard believes that Britain will work with both the G20 and the International Organization of Securities Commissions (IOSCO) to achieve a global consensus on this issue.
Previously, large credit institutions could smile at the promise of financial start-ups to reform the banking business. Now, they want to buy them.
The financial technology industry is entering into a new era of transactions, says Steve Davis, Head of PwC’s fintech division in Europe, the Middle East and Africa. Along with the desire to innovate, the leaders of financial companies can be motivated by fear. Recent report of PricewaterhouseCoopers LLP says that four out of every five banking executives are afraid to yield a share of revenue to independent financial companies.
Almost 50 percent of financial services companies in the world plan to acquire technological start-ups in the next three to five years, says the paper. At the same time, eight out of 10 banks expect to create strategic partnerships with p2p-lending services, digital money transfer platforms and with many other firms that are redrawing the financial business.
source: bloomberg.com, businessinsider.com
These concerns were voiced by Christopher Woolard, FCA Strategy and Competition Director, at the International Innovate Finance Global Summit, held in London on Monday.
Great Britain became the first country to introduce an incubator for fintech startups in 2015. The organization provides banks and start-ups with a "safe environment" for testing new products and services without standard regulatory restrictions.
This approach has later been adopted by other jurisdictions. In this connection, Woolard expressed his fears about a possibility of the emergence of the so-called Wild West, which "will impede our ambitions" and threaten "deterioration of results for consumers."
"We also believe that an incubator, which is unable to prepare a company for entering the regulated market, will not contribute to emergence of successful firms in the long term", Woolard added. "In addition, we are noting potential risks to reputation and confidence in financial innovations, if we witness examples of global failures in the future."
The FCA recognizes that there is hardly any single standard that is suitable for everyone, but providing a "common understanding and closer international cooperation" in the field of innovation "will help to guarantee the future of the industry in the long term." Woolard believes that Britain will work with both the G20 and the International Organization of Securities Commissions (IOSCO) to achieve a global consensus on this issue.
Previously, large credit institutions could smile at the promise of financial start-ups to reform the banking business. Now, they want to buy them.
The financial technology industry is entering into a new era of transactions, says Steve Davis, Head of PwC’s fintech division in Europe, the Middle East and Africa. Along with the desire to innovate, the leaders of financial companies can be motivated by fear. Recent report of PricewaterhouseCoopers LLP says that four out of every five banking executives are afraid to yield a share of revenue to independent financial companies.
Almost 50 percent of financial services companies in the world plan to acquire technological start-ups in the next three to five years, says the paper. At the same time, eight out of 10 banks expect to create strategic partnerships with p2p-lending services, digital money transfer platforms and with many other firms that are redrawing the financial business.
source: bloomberg.com, businessinsider.com
