Compliance in Fintech entails managing, refining and documenting regulatory compliance processes, eg, deal with product owners regarding the launch of products to ensure regulatory requirements are met, as appropriate, while managing regulatory risk and providing reports which meet the needs of the regulator, and at the same time meet group management guidelines and to educate and drive the appropriate execution of fintech business.

As said, Compliance in fintech must be applied in several business areas, and we refer to several rules covering topics detailed in bullet points below.

Common regulation for all Fintech companies are,

  • Rules related to Anti Money Laundering and implementing proper KYC or KYB procedures,
  • Data Protection coverage and structure to the whole business,
  • Compiling with consumers regulation (depending on Eu Directives or national consumer protection), its direct application will depend on the business activity, if B2B or B2C and the focus of the business reputation to avoid potential customer claims,
  • Commercial Regulation (contracts rules),
  • Financial Regulations coming from National Banks that depending if we are located in EU or US or APAC may differe at some or many points,
  • Main binding information will need to be communicated to the customer or users by email or on the home webpage, and will need to be accepted by consent by accepting the binding Terms and Conditions, which will be quite significant on how businesses approach customers.

Moreover and on top of the purely compliance and regulation for the fintech activity, aside topics will also need to be covered and reviewed such as the Board of directors regulatory structure and the implications of the clauses in the agreements, its rights and obligations, the impact of financial and Capital Rounds which will entail a specific Support to the business where necessary.

With that said, when it comes to regulated entities that want to operate under certain regulations to perform transferring funds, payments, getting funds from the public, advertising deposits or high returns, as many  Fintech companies do, must take a deep dive into fintech regulation, mainly at PSD2 regulation in Europe, and local regulation which will be ruled by the Bank of each country.

Since 2015 the main goal for banks and fintech was to find a way and a path to work together and share best practices and data, so they could make better decisions.  In 2015 they(UK Banks and Fintech´s) created the Open Banking working group, where the aim was to be able to share customer data between fintech and banks and benefit all of the parties, and that was the beginning of PSD2 pillars.

The European Banking Authority (EBA)made a huge step as some gray areas which were reserved only for banks were from then on allowed for private fintechs and that involved a new era for compliance in fintech.

The 2 main goals of these new regulated areas in payments market were focused in

  • Consumer protection and its security.
  • Boost competition, innovation and improve the development of new payment ways.

These 2 main topics had been raised as the heart of fintech compliance and business, by increasing consumer protection, fintech regulation included stronger compliance requirements for online transactions, introducing initiatives such as stronger authentication which meant empowering customer safeness and decisions.

In that sense, the 2018 PSD2 regulation opened a wide range of opportunities for fintechs.

What type of operations can be performed under the PSD2 umbrella?


Under the PSD2 European regulation, several legal figures have been created,

PSD2 has enabled several fintech figures that can operate in the market taking banking market share,



Silvia Calls