US regulators appear to be a step behind when it comes to regulating fintech, a factor that is holding back fintech innovations. A new report by BI Intelligence highlights this regulatory lag’s impact on fintech.
Here are some of the key takeaways from the report:
- The US’ regulatory system involves many different players at the federal level, as well as a regulator for each state. This complexity not only makes the US regulatory environment harder for fintechs to navigate in the first place, but it’s a major barrier to the development of a coherent fintech policy.
- The US regulatory landscape means it is falling behind other major fintech regions such as the UK and EU in certain segments. These regions already have established fintech regulatory policies.
- US fintechs are using a number of models to achieve compliance, but none are ideal. As a result, many are finding it hard to achieve the scale necessary for success.
- Some US regulators have realized the need to act regarding fintech regulation, and are launching initiatives with the aim of making compliance easier. That said, a coherent fintech regulatory policy for the US is still a long way off.
Source: Business Intelligence (1 Feb 2017)
