Background

1. For many decades, innovative technologies have been developed and applied to support the provision of financial services. However, over recent years, the range of financial innovations, the prevalence of their use and their pace of evolution have increased substantially to the point that ‘FinTech’, defined at the EU and international standard-setting levels as ‘technologically enabled financial innovation that could result in new business models, applications, processes or products with an associated material effect on financial markets and institutions and the provision of financial services’ [See.], has entered the common lexicon.

2. In light of these developments, there is a challenge for regulators and supervisors, namely to keep pace with technological developments in order to ensure that regulation and supervisory practices allow opportunities presented by FinTech to be fully and properly realised without undermining consumer protection, the level playing field, the integrity of the financial markets and the stability of the financial system taken as a whole.