On 23 March 2017, the European Commission launched a public consultation on FinTech, seeking feedback on how to create “a more competitive and innovative European financial sector”. This represents an important step in the Commission’s work to define a European policy and regulatory framework for FinTech, after the set up of an internal Financial Technology Task Force in November last year.
The European Commission outlines three core principles that will underpin its FinTech approach: i) technological neutrality; ii) proportionality; and iii) market integrity.
The overall objective is to develop a regulatory approach that will foster FinTech’s potential to boost the European single market, by integrating the perspective of both financial services providers and consumers. The European Commission expects FinTech to generate user-friendly, accessible products at lower costs.
Commenting on FinTech developments, European Commission Vice President Valdis Dombrovskis said that, if harnessed well, FinTech can change for the better the financial industry in the European Union. The impact on consumer cross-border access to new products is particularly in focus. He added that, in a global financial market, the European Union needs to develop a coherent approach to foster innovation and competitiveness.
The Commission’s public consultation is structured around four main themes, which reflect the main opportunities and challenges that the European Commission sees in relation to FinTech:
- Fostering access to financial services for consumers and businesses, with a focus on artificial intelligence, big data, crowdfunding, and sensor data analytics’ impact on the insurance business;
- Bridging down operational costs and increasing efficiency for the financial industry, thanks to efficient use of data and cloud computing, distributed ledger technology, and outsourcing;
- Making the single market more competitive by lowering barriers to entry across the European Union, and
- Balancing greater data sharing and transparency with data security and protection needs, in order to ensure consumer trust and to prevent security breaches.
Interested parties can provide input via an online questionnaire until 15 June 2017.