Fintech companies in Spain no longer belong to the future

“Real progress is that which puts technology within everyone’s reach”

Henry Ford (1863-1947).

I love this sentence, the first time I heard it was in a conference many years ago, the second time was on February 2, 2017, in the Fintech forum, presenting their white paper.

According to crowledling; the word Fintech is a compound term that comes from English and that comes from uniting the first syllable of the words Finance and Technology, i.e. a word that arises from joining the two words and that brings together to all those companies of financial services using the latest technology to deliver innovative financial products and services.

Fintech companies are engaged in various business lines: Lending, personal finance, alternative funding, crowdfunding, currencies, Enterprise Financial Management, financial infrastructure, Insurtech, and data management.

Although all of them are in the realm of traditional financial institutions, financing ones are on everyone’s lips:  They take money from their investors and lend it to companies, self-employed, individuals to make investments and thus to generate value.

It is a win-win situation, the investor obtains greater profitability of his capital, the debtor makes his investment and the fintech company charges a commission for the management.

What’s next for the fintech sector in Spain?

In 2013 the number of fintech companies did not reach 50, at the end of 2016 they surpassed 200.

The capital that moves this sector exceeds 11,000 million euros in the world. PayPal, Square, Stripe or Funding Circle are the breakthrough of a booming industry that has established its major strategic centres in Silicon Valley and London. Spain has recently jumped on the bandwagon and the last two years a chessboard with 215 players, generated the first cases of success. With a turnover of about 300 million euros in the last financial year.

Fintech accounts for 21.5% of start-ups equity, only surpassed by electronic commerce. Mooverang Executive Director, Alexandre Lima explains that the rise of the Fintech is also due to a “paradigm shift in the financial sector”, which meant that “more and more users are looking for alternatives” to traditional banking. Most of the companies are devoted to means of payment (23%), followed by loans (21%), financial aggregators (18%) and crowd lending (17%). Nearly half of these (48%) offer services to end consumers, while 38% is devoted to businesses and 14% to both markets.

For me, fintech companies are growing so significantly both because of a widespread dissatisfaction with the investment policies of banks following the collapse of Lehman Brothers and also because of the possibility of giving a better service to meet the needs of the end customer.

And this is the point we reached on February 2, 2017, the presentation of the white paper Fintech regulation in Spain.

fintech and Insurtech (insurance) association of Spain are calling for a specific regulation for the sector.

The AEFI (the Spanish Fintech and Insurtech Association) asks for:

  • Implementation in each Financial Supervisor of the three markets (Banking, Investment and Insurance Services) of a specific Authorization Directorate for Fintech and a technical team that offers advice on how to interpret the rules regarding the product / service.
  • The establishment of advisory units or divisions within the different supervisors as a mechanism to assist Fintech entities in the authorization procedure required to access, where appropriate, the regulated activity as well as once licensed, contribute to simplified Regulatory compliance measures under certain conditions provided that consumer interests are safeguarded.

In the words of Jesus Pérez, president of AEFI,

An ad-hoc regulation for Fintech entities in Spain outside the legal system applicable to the Financial Sector in its three industries (banking institutions and financial institutions, investment services companies and insurance companies and specialized figures as banking-insurance operators, mediators, agents, etc.) is not considered. The focus is placed on identifying what aspects of the conditions of access to the financial activities should be reviewed and improved to adapt it to the new ways of providing financial services “.

We, at, couldn’t agree more.

We believe that the fintech sector does no longer belongs to the future, but to the present and proof of this lies in the corporate operation of our Platform4equity, which recently entered Ekuantia, a company specializing in payment solutions.

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