The Alliance “Fintechs for Europe” is an association for all fintechs supporting the European project and active, either currently or in near future, in multiple European geographies.
We believe that there are common objectives of the European cross-border consumer-oriented fintech sector and we believe there is a need to organise ourselves in a targeted and strategic way and speak with one voice to European decision-makers. The “Fintechs for Europe” alliance would respond to this need. The objective of the alliance would be to shape the policy development through coordinated regulatory and reputation-based advocacy actions vis-à-vis key institutions of the European Union. In general we want be a strong pro-European voice supporting competition, innovation in finance, integration of markets and cross-border customer access.
- When it comes to the majority of financial products, we are still facing 28 diverging and not so-competitive national markets. Because of a multitude of barriers, cross-border activity is still limited. This is bad for consumers, for innovative enterprises and for the overall functioning of the European economy. The cost of compliance is particularly high for non-banks which, unlike banks, do not have a possibility to passport cross-border. There is a huge potential that we have not yet taken advantage of.
- We want to shape policy development and influence laws and regulation for the benefit of the customer and towards an efficient single market
- We want to provide evidence and give feedback to policy makers on a European level regarding topics and issues relevant for Fintech businesses with an interest in cross-border provision of services
- That further European harmonization of guidance and legislation, where it delivers innovation and additional benefit to the customer and fintechs, is a good thing is a core belief of the alliance.
- Therefore we want to encourage the European Institutions, while ensuring financial stability, to move forward in creating a stronger single market for financial services by increasing competition in the financial services and decreasing barriers to entry. Enhancing a common market in Europe would support all Member States and improve the economic and financial future of Europe. Especially in a digital age where physical borders for providing financial services play a decreasing role, clear rules and thresholds for companies, which define market entry and are uniform across countries would be welcome. Ideally digital-only services can be offered across Europe to all European residents with the necessity to comply to domestic regulation only. Alternatively, thresholds for reverse solicitation need to be defined across Europe which would help digital companies avoid at times arbitrary and case-by-case approach by national authorities
Examples of concrete recommendations by the alliance
- Digitalization is opening up new possibilities at a fast pace. If properly dealt with, digitalization could create exactly the momentum needed to start to take away those cross-border barriers. There is now a real chance to link financial actors established all around Europe to consumers residing all around Europe. This is a single market window of opportunity that should not be missed. Customers – especially younger ones – are already used to digital offers in all areas of their life. So regulation must be adapted to the digital customer behavior, especially tackle formal paper-based requirements, eliminate channel frictions and allow customers, in a secure environment, to choose, administer and change their financial provider through online channels. An essential component of such policy would be a standardized and EU-wide common digital KYC procedure which would facilitate local and cross-border digital financial services.
- We call for the Commission to intensify its work against discrimination on grounds of residence in the European market on retail financial services and, if necessary, to complement the planned general proposals to end unjustified geo-blocking with further legislative initiatives targeted specifically at the financial sector
- Consumer protection encompasses a wide range of areas (data privacy, financial advice, handling of complaints...) with strong deviances in rules and application of rules from Member State to Member State. We encourage the Commission for a tough stance on keeping things simple and consistent across the European Union.
- Urges the Commission and the Member States to encourage financial service providers to offer their customers greater choice and more open architecture beyond PSD 2 initiatives. Simplified and clear rules for 3rd party reliance, promotion of API standards, faster settlement across all member states and obligation of banks to elevate barriers for change of the provider will foster competition and create additional value for 500 million consumers in the European markets.
- Simplify, harmonize and update licensing requirements towards new types of service providers, such as marketplace providers, p2p platforms, digital banking and insurance brokers etc. Different than banks and e-money institutions these new providers face vastly differing and at times antiquated requirements in member states, which can be prohibitive for new digital entrants.
- Push banks across the EU to offer banking services to Fintech companies. In countries like Spain some banks are quickly closing down bank accounts, letting some players “naked” and unable to stay in business. In the UK Fintech companies are mainly relying on 2 banks: Barclays and RBS
- Develop profound statements towards European data protection rules; these rules have tightened and jeopardize business models
- Participate in the debate that wants crowdlending-platforms to have equity ratios similar to banks and form a clear opinion on why this is not necessary with regards to financial market stability
- Influence the implementation of the European Anti-Money-Laundering regulation, for example KYC based on VideoIdent should be supported instead of being made difficult, which is currently happening