A Guide to Financial Regulation for Fintech Entrepreneurs

ADVANCE PRAISE FOR A GUIDE TO FINANCIAL REGULATION

"Having been a Fintech venture capital investor for many years now, I am keenly aware of the importance of regulation. Indeed, one of the main issues I encountered when assessing a potential investment is how well-versed the founding team is when it comes to regulatory matters. This will most assuredly be even more important going forward. As such, I am delighted to see Stefan, a Fintech expert I rely on often and who I hold in great respect, covering financial regulatory matters and how important they are for entrepreneurs in his new book. If you are serious about Fintech, please read this book." —Pascal Bouvier, Fintech VC

"If you think of regulation as too hard, you'll either end up in jail or fail for having never tried. In a world where tech is colliding with finance it's great that someone's finally written the missing manual!" —Simon Vans-Colina, Monzo

"Successfully engaging with regulation will differentiate winners from losers in Fintech, and this book offers a strong foundation for founders and investors alike." —Sid Singh, Fintech Investments, US Bulge Bracket Bank

"Stefan lucidly and succinctly captures the essence of relevant regulation for Fintech firms. His book is a very helpful summary of regulatory and risk management priorities." —Jonathan Howitt, Board Member, Professional Risk Managers' International Association

The Fintech Entrepreneur’s Guide to Regulation and Regulatory Strategy

Fintech has been growing dramatically over the last few years, and it is now an important sector in its own right. This means that Fintech companies, who could so far often rely on a comparatively lenient regulatory regime, will now have to give serious thoughts on compliance with applicable regulatory rules.

Operating in a highly regulated environment is tedious, but not all bad—companies that can play the regulatory game well have a strategic advantage, especially with regard to time-to-market and scaling. Nothing spells missed opportunity like a competitor building market share with a copycat product whilst you are still waiting for your license!

Written for professionals, this book helps anyone whose job has to do with formulating or executing a Fintech startup strategy or whose job touches financial services regulation, or anyone who simply wants an easy- to-read introduction to financial services and their regulation.

• Describes the purpose of and principle behind modern financial services regulation
• Explains how to include regulation into a startup’s strategic planning to optimize time-to-market and scaling
• Gives an overview of the entire financial services space, and which regulations apply where
• Gives detailed references to 20 key regulations in the EU regulatory system, including PSD, GDPR, CRD, AMLD, MiFID, UCITSD, AIFMD

The first part introduces financial services regulation, its purpose, how it is created (especially in the EU and in the US), and it develops a framework for including regulations into the strategic planning of a company. It also gives a rundown of the current financial services space—players and products—and its key regulations. The second part describes a regulatory system in more detail. The system chosen is the EU because it is more consistent and unified than the US system where a lot of the regulation still is created at the state-level. However, as most financial regulation nowadays is determined at the global level, the principles found in EU regulation will be by and large also be found the US and other systems.