FIBA on FinTechs: “We Expect the Regulation That Will Come to Leave Enough Space for Creativity to Allow Innovation”
Miami, July 25th 2017 – FIBA is the voice of the international banks operating in the US, and for years has called the attention of the regulators to the fact that the more abundant and restrictive regulation is making the environment more hostile for the once solid and flourishing international financial services industry. Only a few weeks before the celebration of CL@B 2017, the leading conference focused on Financial Technology in the Americas, David Schwartz, President and CEO of FIBA (Florida International Bankers Association), says: “Although robust regulation is needed to combat money laundering and terrorist financing, and a greater transparency is good for everybody, the continuous changes in the regulation and the addition of more complicated requirements take an enormous amount of resources from the firms, that not all of them can easily afford.”
In the last few years, we have seen some institutions exiting certain jurisdictions, or raising the minimum assets maintenance requirement for an account. And in every trade association meeting and conference complaints are expressed about the enormous amount of resources devoted to compliance and technology in order to keep pace with the changing times. The industry is awaiting the ease on regulation that President Trump announced, while technology continues to advance at a rapid pace.
“The financial services industry needs to become digital in order to meet the expectations of the tech savvy customer. Large corporations usually take too long to advance, in part because of regulatory requirements that slow change, and in part because they are better at traditional banking. That is why we have recently started to see acquisitions of FinTech companies, much more agile and innovative, by big banking corporations.” He adds.
“The financial services industry needs to become digital in order to meet the expectations of the tech savvy customer.”
Innovation needs space to happen, needs easy procedures, and certain freedom. But according to David Schwartz: “It is not that FinTechs are not regulated. It is only that there is no specific regulation for `FinTechs´ yet. The meaning of FinTech is very broad, including startups with two entrepreneurs and large corporations such as PayPal, and the regulation they must comply with is different in each case. But, of course, they cannot do whatever they want to.”
He adds: ”Many FinTechs are born with the ambition to be sold to a big corporation that would not buy something that is not in compliance, however you cannot regulate something before it exists and FinTechs as a whole are still emerging. First comes the reality, then comes the regulation. We expect the regulation that will come to leave enough space for creativity to allow innovation.”
About CLAB 2017
The CL@B Annual Conference, organized by the Florida International Bankers Association (FIBA) and the Latin American Banking Federation (FELABAN), is the largest Latin American technology and innovation event featuring networking and learning platforms for the financial industry. The conference is a traditional bridge connecting Latin America and the world.
Its 17th edition will take place in Miami between August 30 and September 1, 2017.
Founded in 1979, the Florida International Bankers Association is a trade organization that provides comprehensive support to the global financial services industry through training, conferences, and advocacy. Its members include some of the largest and most influential financial institutions and organizations in the world. FIBA is recognized by the financial services industry, regulators and authorities as a center of excellence for its knowledge and experience. www.fiba.net
The Latin American Banking Federation is a non-profit entity that currently covers more than 500 regional banks and was created in Mar del Plata, Argentina, in 1965 by banking associations and other agencies of 19 Latin American countries. www.felaban.com
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