REPORT
May/June 2016 ▪ Volume 19 ▪ Issue 3
REGULATORY INNOVATION
FINTECH LAW
E-Banking, Payments & Commerce in the Mobile World
By Jo Ann S. Barefoot Jo Ann Barefoot is CEO of Jo Ann Barefoot Group, LLC (www.jsbarefoot.com), and a Senior Fellow in the Mossavar-Rahmani Center for Business and Government in the Harvard Kennedy School of Government, where she is writing a book on nancial innovation and regulation. A former Deputy Comptroller of the Currency, she is the host of the podcast show Barefoot Innovation (ww w.BarefootInnovation.com) and the video brie ng series Regulation Innovation (www. RegulationInnovation.com), and speaks and writes extensively about FinTech.
Last June, the FCA sought public input on two core questions: (1) what regulations are impeding innovation and (2) whether there is a need for new regulations to enable it. This
Financial regulators in the United Kingdom (“UK”) are innovating about innovation in ways that may reshape government thinking around the world.
IN THIS ISSUE:
The UK has adopted a national strategy aimed at establishing itself as the global capital of Financial Technology (“FinTech”). This policy is being driven from the top with active leadership by the prime minister, chancellor, and nancial regulators. It includes an explicit regulatory mandate to foster innovation that promotes both consumer bene t and industry competition -a challenging mission added to, and balanced with, the traditional regulatory role of managing risk.
Online Lending Faces a Hangover
13
FinTech Law Report: May 2016 Regulation and Litigation Update
16
From the Editors
25
The lead agency in this e ort is the Financial Conduct Authority (“FCA”) which, along with the Prudential Regulatory Authority, oversees the UK’s nancial industry. Beginning in 2014, the FCA launched a series of bold initiatives under the banner Project Innovate, including an Innovation Hub1 that nurtures startups. The Project Innovate website explicitly states that the program “promote[s] competition through disruptive innovation-innovation
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that o ers new services to customers and challenges existing business models.”2 This embrace of disruption is not typical regulatory language. It re ects a belief (which I share) that today’s innovation has the potential to bring vast improvements in consumers’ nancial wellbeing by making services more inclusive, understandable, and empowering - but only if wisely regulated.
Regulatory Innovation
1
The Future is Now: Driverless Cars and the Insurance Landscape
8