Christopher Woolard, the FCA’s executive director of strategy and competition, said he would like to see a collaboration of global regulators to encourage fintech growth; this would be in the style of a global sandbox and would be quite the undertaking but as Mr. Wollard stated, they are up for it; this would allow companies to better understand the regulatory limits and help to stop global issues like money laundering. Source.
News Roundup
This page contains an archive of the Global Newsletter summaries and the weekly fintech news roundups.
Every day the Fintech Nexus news team scours the globe for the most important stories of the day to include in our daily newsletter.
Then every Saturday we bring you our weekly news roundup of the top 10 fintech stories of the week with commentary from Peter Renton.
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The Financial Conduct Authority (FCA) works with the Financial Services Compensation Scheme (FSCS) in the UK to protect investments for consumers; the FSCS is comparable to the Federal Deposit Insurance Corporation (FDIC) in the US; the FCA is currently conducting research and undergoing consultation on the crowdfunding market; current consultation has involved communication between the FSCS and FCA on potential solutions for insuring funds; it's not likely that insured funds will be integrated into the FCA's new crowdfunding regulations however the two agencies are discussing options. Source
Folk2Folk is the most recent marketplace lender in the UK to receive full FCA authorization; largest P2P lender to receive the authorization with origination volume of over 125 million British pounds since 2013; allows it to seek HMRC approval for offering clients the option to invest through an innovative finance individual savings account; minimum investment for platform investors is currently 25,000 British pounds; platform provides secured loans to small businesses with property or land as collateral. Source
The Financial Conduct Authority (FCA) is proposing that they include P2P platforms in the review of the high cost credit industry; the city watchdog said in a release that there is currently a gap in the regulations for P2P; according to the watchdog this means creditworthiness requirements will be enacted when there is a "significant increase in the amount of credit or the credit limit under a P2P agreement"; the FCA explained further changes could come after this initial review period ends on October 31; John Coley, financial services risk director at PwC, explained to Peer2Peer Finance News, "The FCA has published proposals that potentially have a significant impact on firms operating in the consumer credit sector, these include proposed changes for assessing creditworthiness, feedback on its rules limiting so-called payday-loans, and insights into its continuing work into the motor vehicle finance sector." Source
The Financial Conduct Authority has issued an update on its rules for the crowdfunding market; the update is based on feedback received since July and its authorization process; seems there will be a number of modifications; some of the key areas for new regulation in P2P lending include disclosure, wind-down plans, mortgage lending standards, cross-platform investment, investment limits, operational risk complexity, marketing promotions, provision funds, money handling standards, regulatory arbitrage, maturity mismatching, investment for institutional investors and liquidity risk for IFISA investors. Source
The UK’s financial watchdog, the Financial Conduct Authority, issued a warning to investors regarding initial coin offerings (ICOs); in particular they warned of the “high risk, speculative” nature of the new capital raising method; financial regulators worldwide have begun cracking down on ICOs in recent months, China has banned them and the SEC in the US issued a similar warning as the UK. Source
The Financial Conduct Authority (FCA) has launched a study analyzing the UK's mortgage industry; study will focus on the industry's tools for consumers and the partnerships among mortgage lenders; the FCA will specifically seek to identify ways to better utilize technological solutions within the industry; the FCA will be obtaining information from a range of market participants and plans to release the results of the study in an interim report in 2017 followed by a comment period and final report in 2018. Source
The Financial Conduct Authority is proposing new rules for those that offer...
The Financial Conduct Authority's Director of Strategy and Competition Christopher Woolard has reported some concerns over fintech regulations globally; in a speech at the Innovate Finance Global Summit in London, Woolard specifically discusses fintech sandboxes noting concerns about establishing them before any government regulatory standards are in place and suggesting that countries institute some guidance before introducing sandbox initiatives; the UK has been a leader in sandbox innovation and the country plans to publish a full report in May on its first sandbox initiative. Source
The UK's Financial Conduct Authority (FCA) released a discussion paper on blockchain that looked to better understand the new technology and how it can be used in financial services; key takeaways from the paper include the ability to cut costs and remove certain back office operations to streamline processes and increase the speed of reconciliation; while there are many potential benefits, the FCA still wants to ensure the risks don't outweigh the benefits; the FCA is also looking at how they might regulate blockchain, they typically regulate the application of technology but to ensure what they are calling "sensible development" they might consider regulating the actual ledger technology. Source