“Innovation is key to any market’s survival.”
It’s based on that premise that Germany’s Federal Financial Supervisory Authority (BaFin) has launched a FinTech Innovation Hub, intended to spark a dialogue between policymakers and companies developing new financial technologies.
The web portal will act as a knowledge source and publishing platform for the financial regulator, enabling BaFin to communicate its rules and thinking with existing and potential FinTech players that fall under its supervisory remit. It is also a useful resource for businesses that aren’t really sure whether or not they need BaFin’s authorization in their dealings.
For the sake of clarity, the site maps out the different FinTech business models that do require a BaFin permit and explains the necessary procedures and licenses each regulated activity requires.
The site’s publications are also expected to break down complex German and EU laws, providing comprehensive insights into regulations that govern the heavy-regulated financial services sector.
The president of BaFin, Mark Branson, also sits on the supervisory board of the European Central Bank (ECB) and his recent public statements shed light on the general shape of EU regulatory frameworks and on the direction policymakers are taking.
In recent weeks, for example, Branson has made several comments on key considerations in the debate over crypto regulation.
Speaking at an event in Frankfurt earlier this month, he said that the recent crypto crash was fortunately timed considering there are still limited ties between digital assets and traditional finance.
In subsequent comments made in an interview published on the European Central Bank website, he said that although there is a risk that overregulation could stifle innovation, doing nothing is not an option given the risk that crypto market volatility could spill over into the wider financial sector.
See more: BaFin President: Banks’ Interest in Crypto Is ‘Limited’
As the largest economy in Europe and home to banking and technology giants, Germany also needs startups and young FinTech innovators if it is to continue to play its role as one of the continent’s political and economic leaders.
It remains to be seen if the country’s financial regulator can lead that charge with initiatives like the innovation hub.
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