10 Apr Meet The Regulators
Holland FinTech organised a special Meetup in close cooperation with the AFM, the Dutch Financial Markets Authorities. Together with DNB (the Dutch Central Bank), the AFM supervises the financial sector in the Netherlands. Both AFM and DNB are regulators that grant licences to firms that offer various financial products. The providers of those services are being assessed before getting a licence and the provider’s behaviour is being monitored after the licence has been granted.
With the emerge of FinTech, the financial sector sees many new players delivering financial services in a different way than being done by existing institutions. These very often rises the question if and to what extend a licence is necessary. A great part of regulation exists in order to protect consumers from malpractices, but also to make sure that the market is accessible for new players. Too many regulations can make it impossible for financial innovation to flourish.
With this in mind the Meetup was organised by experts from the AFM and representatives of a selective number of FinTech companies. The aim was to share experiences and work together to identify what is required to foster financial innovation. During the Meetup there were five round table workshops covering the following topics; Disintermediation, Data applications, Automated advice, Risk management and Payment services. Supervisors and entrepreneurs shared what issues they encountered with bringing innovative services on the market.
“Fairness and transparency are the principles that are highly respected by the AFM”, mentioned Theodor Kockelkoren, member of the Board of Directors of the AFM, in the speech that followed the workshops. Many Fintech companies deliver innovative services that promote fairness and transparency in itself, because they are designed in different ways than existing services. “It is therefore important that supervisory bodies work closely together with these companies, but at the same time it is important to recognise that every organisation has its own responsibilities.”
There were many obvious take aways from the Meetup, like how difficult it is for a legislator to regulate things that are not foreseeable, the advantage of a one stop shop for granting the different licences and the need for innovations in supervision itself. One of the main take aways is that there is a facility for early stage questions about innovations in financial services, but it is not very well known. It is called the Innovation Room. More information can be found here.
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