While established financial services providers bemoan the burden of regulation, fintech companies would like closer supervision from the financial regulator. This is the message coming from a Geneva-based fintech accelerator.
As a former president of the Zurich Farmers’ Association, Finance Minister Ueli Maurer is an unlikely Mr Fintech, as finews.com titled him after he launched new regulations last November that aim to secure Switzerland the prize of top fintech location.
The government wants to lower entry barriers for fintechs by expanding the regulation-free area – for example with a special sand pit for start-ups – and by introducing a fintech licence.
In the meantime, the wheels are turning to write new legislation, with the consultation process for new fintech regulations underway since February.
Links in Singapore
These moves have improved the international standing of Switzerland as a location. The fintech agenda is also part of the reason Maurer is currently in Singapore, where among other things, he is attempting to foster fintech collaboration with the Asian city state.
However, at home, fintech players are not totally happy with the minister’s work. Switzerland’s first fintech incubator Fusion in Geneva made a consultation submission containing various proposals for improvement. In the document published Wednesday, the fintech program complains that much has been done to smooth the way for start-ups – but not enough to tie them to the location long-term.
Montessori Sand Pit
Surprisingly, Fusion is now calling for the federal financial regulator (Finma) to keep a firmer grip on young companies. Instead of free play in the sandpit, the Geneva player is demanding guided activity following clear rules – the Montessori method instead of the anti-authoritarian approach.
To this end, Fusion wants the financial regulator to set up a specialized «ad hoc» fintech department to look after the needs of the sector. Finma has the organisational freedom to manage this, Fusion claims. It is true that there is no dedicated office for fintech matters at the supervisory authority.
Finma has merely bundled the communication channels together so that the companies can get through to the authorities more quickly with their queries.
Fusion would also like to see Finma connect better with foreign regulators, like the Monetary Authority of Singapore. At least this wish seems to be already fulfilled with the visit of «Mr. Fintech» to the city state.
