ECB working on licensing rules for fintechs

[FRANKFURT] The European Central Bank is working on new licensing guidelines that would also cover financial technology firms, Daniele Nouy, the ECB's top bank supervisor told a conference on Wednesday.

The fintech sector, though still relative small, has been stealing market share from traditional lenders in a variety of sectors from payments to lending, attracting investment US$6.5 billion in the first half of the year.

"At the ECB, we are, for instance, devising a guide on licensing that also covers fintechs," Mr Nouy told a conference.

"This guide will be published shortly for the purpose of a public consultation."

"The technical and financial hurdles have become a bit lower; the (banking) market has become more contestable," Mr Nouy said added.

The nascent industry, ranging from mobile payment apps to 'cryptocurrencies' like bitcoin, is seen playing a crucial role in the future of financial services but regulators are still searching for ways to properly supervise a sector that has largely flown under their radar.

REUTERS