Start up & Fintech


The past few years have witnessed extraordinary developments in financial technology or more commonly known as “fintech “. These advances include innovations in mobile payments, digital currencies, blockchain technology, peer-to-peer lending, and also marketplace lending.

Most Fintech innovation is driven outside of the more traditional financial and banking systems, using various means to accelerate the innovative process. This pioneering approach can be driven by non-bank entities, including venture capital-backed fintech startups and emerging companies as well, including a vast number of non-traditional providers. These non-bank entities can the pursue their goal within the marketplace in a somewhat unregulated atmosphere while also using their flexibility to focus on a particular set or sub-set of new financial and banking services for clients.

At RWT, we will continue to be in the forefront of Fintech by shifting the client experience to a more client-centric and interactive approach to financial and banking services. In addition to these advanced approaches, fintech also creates new opportunities for client value creation by the design of new personalized products and services that cater specifically to each client. One of the most important aspects of the Fintech revolution is the capability and widespread reach of data networks and smartphones. This ability to connect throughout the world creates enormous opportunities for fintech innovation to continue to expand globally.

Fintech innovation puts added burden on banks and other regulated financial institutions to embrace these new technologies as banks are currently taking significant steps in this direction. This includes large investments in client services and customer reporting using digital channels and the creation of internal digital teams dedicated solely to this area, and budget increases to cultivate digital change and innovation. Once feared due to lack of education in these areas, a new spirit of cooperation is also developing throughout the globe. A number of leading banks are now re-thinking the way they interact with the fintech industry. These financial institutions are now engaging with fintech incubators, while also launching their own fintech programs as well as establishing their own investment funds and supplying fintech startups with innovative forms of collaboration and partnership. With the explosive rise of Fintech, there is also opportunities for others who may choose to manipulate it. Therefore, this has drawn attention of financial regulators as well as firms such as RWT. Therefore with the developments and innovations in fintech there can also be a segment can also create and increase a number of risks and complexities in terms of privacy, personal information and data treatment, customer protection, transparency, and cyber-security. For these reasons, regulatory oversight of fintech is increasingly tightening. Financial regulators are now trying to encourage developments in fintech by providing an environment where innovation can thrive, while simultaneously protecting markets, consumers, and investors.

As the fintech ecosystem matures, banking and financial regulatory regimes are also evolving swiftly. Financial regulators are now evaluating existing rules and are considering the adoption of new regulation to better address both the opportunities and challenges presented by new technologies. In particular, financial regulators in the United States, Europe, and the United Kingdom have recently enacted, or are in the process of enacting, a number of policies and rules specifically targeting fintech innovation. The disruption and evolution in banking and financial services caused by fintech innovation has heightened the need for these new policies and rules to be both thorough and forward thinking. oversight and regulation are, thus, critical factors for the growth of the fintech ecosystem and could significantly affect the extent and speed of its future developments. The research project will delve deep into this point by analyzing and comparing the rapidly evolving fintech legislative and regulatory frameworks in the United States, Europe, and the United Kingdom. Building on the findings of this comparative analysis, the research project will, then, examine proposals of new regulation that could facilitate safer pilot-type, small-scale fintech innovation and could enable more effective supervision of the way risks from fintech innovation are identified and addressed. The research project will, then, conclude by discussing initiatives aiming at promoting ongoing and more effective dialogue between fintech industry and financial regulators, as well as more effective cross-border coordination of fintech regulatory oversight.