2023 Fintech and Financing Conference & Expo

Canada’s Regulatory System for Fintech is Complex, Costly and Chaotic. It is Stifling Fintech Innovation

Crowdfund Insider | | Apr 4, 2019

michael king - Canada’s Regulatory System for Fintech is Complex, Costly and Chaotic. It is Stifling Fintech InnovationCanada may be a smaller market but it has a robust, highly sophisticated economy and a vibrant Fintech sector. Toronto, the financial center of the country, is home to dozens of Fintechs including payment firms, online lending, AI, wealth management, blockchain and more. Yet while there are promising indications of financial innovation and a good number risk-taking Fintech entrepreneurs, a recent Canadian report noted a “need for a clear Fintech strategy by the federal and provincial governments with the intent of supporting innovation and growth for the Canadian financial services sector.”

Like most other industries, competition in financial services is intense. As it is a highly regulated sector of industry, participants must continuously manage compliance demands while interacting with diverse public officials and regulatory requirements. These same rules, if duplicative or misaligned, can act as a barrier to positive innovation and change that challenges established firms and entrenched orthodoxies.

The emergence of Fintech and the digitization of financial services, from banking and beyond, has seen multiple Fintech centers of prominence emerge. The UK has long been known for its Fintech friendly regulatory environment. Regulators frequently engage with emerging new business models as it is mandated for these officials to foster competition.

See:  Inside the power struggle between big banks and fintechs to modernize financial services

In Hong Kong, an important global financial center, public officials have not only talked about fostering Fintech innovation, but much money and resources have been dedicated to encouraging innovation. Fintech is viewed as strategically important to maintain a dominant position in the global financial industry.

So can Canada do more?

Crowdfund Insider recently reached out to Michael King for his perspective on the status of Fintech in Canada. King is co-Director of the Scotiabank Digital Banking Lab at Ivey Business School and an advisor to the National Crowdfunding and Fintech Association of Canada. He spent multiple years in the private sector working in the global banking industry so he has plenty of hands-on experience.

King recently created a helpful database of Fintechs operating in Canada which provides a good overview of these new firms. King believes Canadian officials, both regulatory and elected, must do more to catch up in the international race to remain relevant and competitive in the global financial sector.

So will Canadian policymakers listen? Our conversation is shared below.


Which international jurisdictions do you believe are doing the best in fostering Fintech innovation?

Michael King: The leading jurisdictions for Fintech are the UK, Australia, Hong Kong, and Singapore. Each of these countries has outlined a national strategy to be a leader in Fintech and is coordinating both public sector and private sector bodies towards achieving this goal. These small open economies understand that financial services are a global industry that has been opened up to foreign competition by the internet, cloud computing, smartphones and other technologies.

Canada is lagging, with no coordination nationally and harmful competition between Fintech centres across Canada.

See:  NCFA Letter to Ontario Economic Development on Burden (Jan 2019)

The leading jurisdictions for #Fintech are the UK, Australia, Hong Kong, and Singapore. Each of these countries has outlined a national strategy to be a leader in Fintech 

Which sectors of Fintech do you believe hold the most promise?

Michael King: The payments sector is the front line of the battle between Fintechs and incumbents. This trillion-dollar industry is complex, with many players collaborating and competing in overlapping networks. Consumers and businesses face many pain points, such as high costs, slow transfers, poor service and little to no transparency. Payments is where the largest and most successful Fintech companies have made their mark, led by PayPal, Square, Stripe and Adyen.

Canada’s Lightspeed POS is the leader in this space, although there are dozens of smaller start-ups targeting lucrative segments of this value chain.

Payments is also the space where global technology companies are able to compete most effectively by bundling payments with their other customer offerings: Alipay (Alibaba), Amazon Pay, Apple Pay, Google Pay, Samsung Pay and WePay (Tencent).

These “Techfins” have put technology first and financial services second when developing their ecosystems. But access to customer payments will bring data and insights to drive future financial product offerings.

On relative terms, how does Canada size up when it comes to Fintech innovation?

Michael King:  Canada remains in the top 10 for Fintech innovation with investment by both start-ups and incumbent banks, insurance companies and asset managers.

Canada has been gaining ground in key areas of Fintech, namely payments, cryptoassets and blockchain, online lending, and wealth management.

See:  Competition Bureau weighs in on fintech: urgent action required

On a public policy basis, what has been done so far?

Michael King:  Federal politicians in Canada are pursuing a policy of benign neglect towards the Fintech sector, preferring to leave policy to provincial governments and regulators while focusing on other innovation priorities. Canada has not published a national strategy on Fintech, none of the funding for superclusters was directed to Fintech, and no politicians are offering speeches to support this sector. The only recent indication of support is the public consultations on open banking, which has already been adopted in the European Union, United Kingdom and Australia.

Canada prefers to be a follower on open banking, balancing the need for more openness with the desire to maintain a sound and stable financial system.

Continue to the full article --> here


NCFA Jan 2018 resize - Canada’s Regulatory System for Fintech is Complex, Costly and Chaotic. It is Stifling Fintech Innovation The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

Latest news - Canada’s Regulatory System for Fintech is Complex, Costly and Chaotic. It is Stifling Fintech InnovationFF Logo 400 v3 - Canada’s Regulatory System for Fintech is Complex, Costly and Chaotic. It is Stifling Fintech Innovationcommunity social impact - Canada’s Regulatory System for Fintech is Complex, Costly and Chaotic. It is Stifling Fintech Innovation

Support NCFA by Following us on Twitter!







NCFA Sign up for our newsletter - Canada’s Regulatory System for Fintech is Complex, Costly and Chaotic. It is Stifling Fintech Innovation




NCFA Canada | Mahi Sall | Nov 28, 2022 Thought Leadership Series of Expert interviews and insights related to a made-in-Canada open banking regime The National Crowdfunding & Fintech Association of Canada (NCFA), true to its mission of providing education, industry stewardship, networking, growth, and funding opportunities for innovative financial technologies and related sectors, is pleased to launch a brand new thought leadership series on Open Banking led by Berlin-based NCFA ambassador and independent expert in Fintech-Bank Partnerships Mahi Sall. NCFA is proudly contributing this thought leadership series to help shape a system that will bring profound changes in how financial services will be created, distributed, and consumed in Canada over decades to come.  Our hope is that Canada’s Open Banking system will improve economic outcomes, improve market efficiencies and competitiveness, and enable consumers to access new and innovative financial services in a way that is secure, efficient, and consumer-centric. The series is called ‘Canada’s Open Banking Journey’ and aims to aggregate international and domestic perspectives of Open Banking/Finance expert practitioners from around the globe to advance dialogues, key considerations, and explore potential solutions for the development of a made in Canada open banking regime with the following timeline: Sep ...
Read More
NCFA OB series Stephane Nouy Moneythor  - Canada’s Regulatory System for Fintech is Complex, Costly and Chaotic. It is Stifling Fintech Innovation
Guest Post | Nov 25, 2022 There has been a change in the corporate world regarding the necessity to protect assets during the last few years. The definition of what must be safeguarded and to what extent has become more difficult. Only 15 years ago, most businesses focused on safeguarding assets as they were the most valuable ones. Data are typically at the top of the list of assets that businesses must now include in their inventory. In addition to branding, connections, non-revenue rights, and intellectual property, your data is a form of intangible asset that you own. Let’s take a look at how to protect your data in this data room review. All digital papers are kept in electronic format in a virtual data room. It lessens the amount of physical paperwork produced by firms and aids in protecting their intellectual assets. To maintain track of commercial transactions, a lot of businesses use VDRs. They will also be beneficial for asset management and fundraising. The best virtual data room providers can stop files from being downloaded. They safeguard each file present in the data room. What Exactly Is a Business Data Asset? A particular kind of intangible asset made ...
Read More
Pexels Christina Morillo Virtual data rooms - Canada’s Regulatory System for Fintech is Complex, Costly and Chaotic. It is Stifling Fintech Innovation
Guest Post | Nov 25, 2022 Video conferencing has become an essential part of business, and it’s easier than ever to use it. You can use video conferencing for any type of call, including sales calls, customer service calls, and even team meetings. Video conferencing can help your company grow by making every call more personal—and therefore more effective at closing deals. Use video to give your sales demo. Video conferencing is also a great way to give your product a demo. If you're selling an online course or software, it's important that a prospect understands what they're buying before the sale is made. Video conferencing allows you to show off your product in action and discuss its features and benefits with potential customers. In addition to demos, video conferencing can be used when conducting sales calls with multiple people on either side of the call. In this scenario, having all parties in one room makes it easy for everyone involved in the call to see each other—and build rapport by seeing each other’s faces as they talk about their products or services (or how much fun they had last weekend). Use video to make yourself compelling and cut through ...
Read More
Unsplash Christina wocintechchat.com video conferencing - Canada’s Regulatory System for Fintech is Complex, Costly and Chaotic. It is Stifling Fintech Innovation
Protos | Nov 23, 2022 The Grayscale Bitcoin Trust (GBTC) is an over-the-counter (OTC) traded fund meant to track the price of bitcoin. Grayscale Investments is owned by Barry Silbert’s crypto mammoth Digital Currency Group (DCG), which also owns beleaguered crypto trading and lending firm Genesis. For a long time, GBTC traded at a significant premium to its NAV, with shares trading for as much as double the value of the corresponding bitcoin. While this premium persisted, institutional investors were incentivized to lock up bitcoins and receive GBTC shares, which they hoped to sell once the six month period elapsed. However, this trade become popular among a variety of firms, including BlockFi and Three Arrows Capital (3AC). As shares began to unlock, GBTC eventually started trading at a discount to NAV. This became particularly challenging for BlockFi, which had lent 3AC money against GBTC collateral. Eventually, 3AC was liquidated by BlockFi, which meant increased selling of GBTC into the market, further raising the discount. Currently, GBTC trades at around a 45% discount to NAV. Grayscale will not share proof of reserves See:  SEC Rejects Bid to Turn the Largest Bitcoin Fund Into an ETF -> Grayscale Sues SEC Fundraising: DCG, ...
Read More
Grayscale and bitcoin trust - Canada’s Regulatory System for Fintech is Complex, Costly and Chaotic. It is Stifling Fintech Innovation
Guest Post | Nov 25, 2022 For many companies, pricing software is seen as a way to solve all the problems associated with this process. Yes, software today boasts a range of features and capabilities. These include even the ability to perform various tasks according to given algorithms using artificial intelligence. But are ready-made software solutions able to get rid of all problems? Let's take a look at their advantages and disadvantages. Should You Use Pricing Software? Customers need personalization in every area of retail. According to Epsilon about 80% of them want to see it at different stages of the purchase, including pricing. Today there are no software solutions that could completely replace the work of specialists, but they can help with the automation of work processes. Today it is as important a tool as CRM. Why? Let's look at the benefits. Benefits Pricing software has a number of key benefits: Building optimal prices. The software is able to analyze the overall pricing. This allows the business of both the B2B and B2C segments to remain competitive. By collecting data from different sources such as CRM, GA, e-commerce platforms, etc., the software can offer the best pricing options. Evaluation ...
Read More
Pexels Karolina Grabowska Optimal pricing strategies - Canada’s Regulatory System for Fintech is Complex, Costly and Chaotic. It is Stifling Fintech Innovation
Fortune | Alena Botros  | Nov 23, 2022 The former CEO of PIMCO sees three trends that suggest a transformation in the global economy is under way. There’s a tendency to see economic challenges as “temporary and quickly reversible,” El-Erian wrote in a commentary for Foreign Affairs. He referenced economic theory that a recession occurs when a business cycle reaches its natural endpoint and before the next cycle really takes flight, but he said this time won’t be one more turn of the “economic wheel,” as he sees the world experiencing major changes that “will outlast the current business cycle.” 3 Major Shifts: 1.  The first shift was driven by the effects of the pandemic, beginning with the entire system coming to a halt and stimulus from the government, or what El-Erian called “enormous handouts,” causing “demand surges well ahead of supply.” 2. It’s tied to Russia’s invasion of Ukraine that resulted in sanctions and geopolitical tensions, along with a widespread labor shortage brought forward by the pandemic. These disruptions in supply chains gave way to “nearshoring,” a more permanent shift of companies moving their production closer to home, rather than a reconstruction of the 2019-era supply chain. This essentially ...
Read More
Global economic shift - Canada’s Regulatory System for Fintech is Complex, Costly and Chaotic. It is Stifling Fintech Innovation
Nov 25, 2022 There are countless altcoins in existence, but only a minute percentage have the potential to outmatch Ethereum, which has come second only to Bitcoin for some time now. Even with the market crash following the NFT surge and ‘The Merge’ taking place, Ethereum still holds a strong position. If you haven’t already got Ethereum in your investment portfolio, continue reading for three reasons why you should. Ethereum Has a Functional Ecosystem Ethereum broke into the blockchain landscape back in 2015 and bought with it the incredible power of smart contracts, which can be built over the blockchain. Smart contracts are automated programs designed to execute once any terms are met, meaning the middleman becomes redundant. For example, if someone gives collateral to secure a loan it can be returned automatically once the repayment terms have been made. The smart contract infrastructure sits at a completely polar opposite to Bitcoin, which only exists as a digital currency. The smart contract infrastructure of Ethereum is the main reason why developers flocked to the platform. Currently, more than 4000 developers are working on Ethereum each month. According to findings from State Of The DApps, more than 4000 applications are running ...
Read More
Pexels RODNAE Productions Ethereum - Canada’s Regulatory System for Fintech is Complex, Costly and Chaotic. It is Stifling Fintech Innovation
Yahoo Finance via Reuters | Huw Jones | Nov 24, 2022 LONDON (Reuters) - The crash of FTX exchange has injected greater urgency into regulating the crypto sector and targeting such 'conglomerate' platforms will be the focus for 2023, the new chair of global securities watchdog IOSCO said in an interview. Jean-Paul Servais said regulating crypto platforms could draw on principles from other sectors which handle conflicts of interest, such as at credit rating agencies and compilers of market benchmarks, without having to start from scratch. IOSCO, which coordinates rules for G20 countries and others, has already set out principles for regulating stablecoins, but now the focus is turning to platforms which trade in them. In mainstream finance there is functional separation between activities like broking, trading, banking services and issuance, with each having its own set of conduct rules and safeguards. "For investor protection reasons, there is a need to provide additional clarity to these crypto markets markets through targeted guidance in applying IOSCO’s principles to crypto assets," Servais said. "We intend to publish consultations report on these matters in the first half of 2023," he added. The European Union's new markets in cryptoassets or MiCA framework is an ...
Read More
global perspective - Canada’s Regulatory System for Fintech is Complex, Costly and Chaotic. It is Stifling Fintech Innovation
DOJ | Release | Nov 21, 2022 Two Estonian citizens were arrested in Tallinn, Estonia, yesterday on an 18-count indictment for their alleged involvement in a $575 million cryptocurrency fraud and money laundering conspiracy. According to court documents, Sergei Potapenko and Ivan Turõgin, both 37, allegedly defrauded hundreds of thousands of victims through a multi-faceted scheme. They induced victims to enter into fraudulent equipment rental contracts with the defendants’ cryptocurrency mining service called HashFlare. They also caused victims to invest in a virtual currency bank called Polybius Bank. In reality, Polybius was never actually a bank, and never paid out the promised dividends. Victims paid more than $575 million to Potapenko and Turõgin’s companies. Potapenko and Turõgin then used shell companies to launder the fraud proceeds and to purchase real estate and luxury cars. See:  Digital Asset Classification vs Wire Fraud: What’s the Most Powerful Law in Crypto Right Now U.S. Attorney Nick Brown for the Western District of Washington: The size and scope of the alleged scheme is truly astounding. These defendants capitalized on both the allure of cryptocurrency, and the mystery surrounding cryptocurrency mining, to commit an enormous Ponzi scheme. They lured investors with false representations and then ...
Read More
Pexels Kindel Media Arrested man in handcuffs - Canada’s Regulatory System for Fintech is Complex, Costly and Chaotic. It is Stifling Fintech Innovation
Guest Post | Nov 24, 2022 In the world of finance and technology or fintech, innovation can be a powerful tool in improving customer experience and driving business growth. One aspect of this innovation is the use of location-based data to maximize financial performance. This data can be used in various ways to track competitors, optimize logistics and improve customer relationships, among other things. Let’s dive into how location-based data can help you get ahead in the ever-evolving fintech world. Location Data 101: Definition Benefits Location data is information derived from a device or system, for example, a smartphone, GPS tracker, Phone Number Location Tracker, or other interconnected gadgets. This data can furnish profoundly precise details about an individual's movement and the time they were in any given area. Fintechs utilize this agglomerated location data drawn from several sources and then synthesized into one single platform to make smarter and more informed decisions. Location data can enable fintech companies to: Identify new customers and build a better understanding of their behavior Monitor competitors’ activities, customer visits, marketing campaigns, and more Make strategic decisions about pricing, product offerings, and promotions Foster loyalty and drive repeat purchases Improve customer experience by delivering ...
Read More
Unsplash NASA North America location - Canada’s Regulatory System for Fintech is Complex, Costly and Chaotic. It is Stifling Fintech Innovation

 

Leave a Reply

Your email address will not be published. Required fields are marked *

one × 4 =