A new streamlined approach to supporting ‘fintech’ and other potentially innovative start-ups through regulatory hurdles is already paying dividends.
Binu Paul, Financial Markets Authority (FMA) fintech specialist lead, said since launching the cross-agency strategy earlier this month two parties have engaged with a multi-regulator panel with five others queued up.
Under the process, fintech regulatory enquiries directed at any of the government agencies are now automatically referred back to his FMA desk for assessment.
After completing an in-depth questionnaire that clarifies where the business proposition intersects with regulation, the FMA organises a combined meeting with appropriate authorities to provide direct feedback.
“It’s landed really well with the industry,” Paul said.
He said previously start-ups in the sector may have dealt separately with many government authorities including, but not limited to: the FMA; the Reserve Bank of NZ (RBNZ); the Commerce Commission; and, the Department of Internal Affairs.
Rather than sourcing, possibly contradictory, advice from each regulator and government department, the fintech “one-stop-shop” combines efficiency with coherent guidance, Paul said.
“Many start-ups are not quite sure which regulators their ideas may fall under – and it can be very confusing,” he said. “Now this is an easy way to get regulatory guidance and aggregated feedback from all relevant agencies.”
The FMA is the lead agency on fintech matters in the NZ Council of Financial Regulators (COFR). COFR, which meets quarterly to discuss financial industry issues, includes the FMA, RBNZ, Commerce Commission, Treasury and the Ministry of Business, Innovation and Employment as members.
Industry body FinTechNZ said the new FMA-managed service would “be a game changer connecting the tech sector with the Regulators who really do want to support innovation”.
Paul, who has a long history in the broader NZ investment market and as a fintech entrepreneur, was appointed to the newly established FMA role last November after previously consulting to the regulator.
FMA chief, Rob Everett, said at the time: “We want to foster technology innovation that improves outcomes for consumers and we believe there is potential for the FMA to work with industry to enable New Zealand to adopt more fintech developments.”
While currently operating through back-office regulatory channels, Paul said he hoped to develop a more direct online version of the fintech consulting service.