Policy Update — Week of the 13th February
Innovate Finance to host TPWG Roundtable on RegTech in Washington
Innovate Finance will be hosting its first Transatlantic Policy Working Group (TPWG) of 2017 in Washington on March 1st, focussing on RegTech and the role of technology in dealing with regulatory complexity. For more information and to request attendance get in touch.
Innovate Finance meets with EU Commission Vice President
Last week Innovate Finance together with members from across the payments, Robo-advice, RegTech, crowdfunding and financial inclusion sub-sectors met with Valdis Dombrovskis, the Vice-President for the EU Commission, in charge of financial stability across the EU.
The discussion centred on the Commission’s forthcoming work on a Financial Technology Task Force, as well as key FinTech issues to address at the EU level including: PSD2 and Open Banking, blockers to cross-border activity such as localised national regulations, and the need to maintain research funding through programmes such as Horizon 2020.
Call to Action
Last week Innovate Finance issued a call for input on the demand and feasibility of an Industry Sandbox in the UK. This follows an invitation by the FCA, and explores options on validating innovative FinTech ideas, and facilitating industry collaboration on shared challenges.
The Embassy of Sweden in the UK and Bloomberg are hosting a keynote address by Minister Mikael Damberg, Swedish Minister for Enterprise and Innovation. The talk will take place on Friday 24th February and will focus on increased cooperation between Sweden and the United Kingdom on driving innovation and entrepreneurship.
- Charlotte Hogg has been named the new Deputy Governor of the Bank of England, this comes on top of her role as the Bank’s Chief Operating Officer. Her role will include execution of the Banks’ QE programme, voting on interest rates and regs underpinning financial stability.
- Bob Wigley, the former chairman of Yellow Pages will be the chair of a new financial services trade association bringing together 6 member organisations, namely the: ABFA, BBA, CML, FFA UK, Payments UK and UKCA. The complex integration process will begin later in 2017.
- Nesta, this week launched a £5m prize fund to help stimulate innovation and further the UK’s drive towards Open Banking. With the development of Open Banking APIs by 2018, the provision of anonymised banking data for 3rd parties will ‘potentially revolutionise how banking looks, feels and works’.
- Innovate Finance is keen to support this initiative, with our Director for Policy and Regulation, Daniel Morgan, sitting on the prize committee and Nesta recently confirming their place as a programme partner for IFGS 2017.
- Open Banking APIs and PSD2 do not just present an opportunity for banks and FinTechs, but also large Internet companies such as Google, Apple, Facebook and Amazon (GAFA). It will present an opportunity for these firms to initiate payments through European banks rather than going via card schemes.
- The CEO of Starling Bank, Anne Boden remarked leaving the European Union might dampen the pace of financial liberalisation. Transformative pieces of legislation such as PSD and PSD2 are in part what ‘made the UK such a vibrant FinTech hub’, though Ms Boden remains optimistic that the UK will remain an important global hub for FinTech.
- With less than 16 months until the GDPR comes into force (May 2018) greater clarity and guidance is required, especially over changes to consent and profiling — without sufficient time to prepare for compliance, businesses may be left in the dark about what they can and cannot do with customers data.
- In the realm of data legislation, the Commission has also published draft e-Privacy Regulations, which looks to cover areas not wholly addressed by the GDPR including individual and business-specific rights such as confidentiality the and law covering ‘electronic communications services’. The Commission’s aim is for regulation to apply from 25th May 2018 (the same date as GDPR).
- Finally, US Federal Reserve Chair Janet Yellen responded to Congressman Patrick McHenry’s criticism about on-going participation by the Fed in international financial regulation forums. Yellen said, “by participating in the development of international regulatory standards, the Fed Reserve can influence the standards in ways that promote the financial stability of the United States”.