Universal view on FinTech regulation - read in the blog of the company COREDO

Universal view on FinTech regulation


The goal of financial technology is to facilitate and improve the way financial services are used. By putting to use algorithms and special software, FinTech offers the possibility of managing financial processes more efficiently to businesses and consumers. Thanks to these efforts, financial services have become more inclusive.

The background

Being a relatively young sphere, the FinTech industry continues to grow fast. However, the present regulatory system is not always able to keep pace with this development. Generally, the lawmakers in many countries are aware of this problem and admit the need for innovation. A step in this direction is the creation of regulatory virtual spaces that promote FinTech activities.

On the other hand, regulators are not willing to overlook the risks that already exist in the financial sector: fraud, problems with cybersecurity. Moreover, the new products brought by financial technology are regarded as a possible source of the new risks: customers can be unfamiliar with them and take them without knowing. Therefore, the lawmakers’ task is to find a compromise between the risks connected to the new technologies integrated into existing businesses and the competitive advantages offered by FinTech. This leads to a rather high amount of regulating measures in this sector.

Types of regulation

In many jurisdictions, lawmakers are doing their best to manage these challenges. Typically, the FinTech related policies can be divided into three categories:

  • Direct organizers of FinTech activities – it is related to some activities such as Robo-advice, payment services, and digital banking;
  • Regulating the use of new technologies in the financial services – these measures include new guidelines for market participants;
  • Promoting digital financial services – arrangements that help new initiatives like data sharing, digital identities, and others.

Fields of the FinTech regulation

Primarily, FinTech regulators pay high attention to:

  • Investment fraud
  • Securities of cryptocurrencies
  • Money laundering
  • Taxation
  • Systemic risk regulation
  • Central bank functions.

Besides, financial authorities are worried about the possibility of artificial intelligence making money unfairly. Another goal is to be truly proactive when it comes to controlling FinTech in order to prevent businesses from migrating to this new sector because the regulation there seems mild to them.


The ability of regulators to estimate the FinTech regulatory environment correctly is crucial. The reason for this is that FinTech companies are currently operating with little capital, and severe regulation can have a negative impact on them. On the other side, it is also important not to underestimate the possible risks arising with the use of new technologies in the financial sector. This step is vital for the overall security: keeping the investors safe, protect data, etc.  

COREDO specializes in providing advisory services for businesses and individuals facing the unprecedented changes of the financial regulation connected to the use of the new technology in this sector.


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