It was after a collaboration within Vinnova's effort Policylab that the Financial Supervisory Authority's work with policy development began in earnest. This in turn resulted in a forum for policy development that the fintech companies can now turn to.
- This is not a legal advisory service because it is something we neither can nor want to conduct, says Stig Johansson project manager and financial inspector at FI. It is more about conducting a dialogue around innovation and how different regulations can be interpreted. We believe that it can help the companies to feel more secure, but above all I see it as funding for FI as an organization because it means that we get more quickly into the development that is taking place right now and avoid falling behind.
An industry where regulations govern everything
Fintech is one of the industries where the most investment is made in innovative startups globally, and FI's effort makes the environment in Sweden even stronger because regulations are such an important part of all fintech. It simply strengthens Sweden as an ecosystem for fintech services for both new companies and established ones, without renouncing the stable institutions that are already in place.
- Potential growth and highly qualified jobs are one part. The second is that it means that more services have the opportunity to reach out, such as cheaper mortgages, more transparent services and more informative visualizations, which benefits consumers, says Peter Svensson, project manager at Vinnova. We already know that there is a lot of experimentation with many new business models and ways of setting up financial services, which is the first prerequisite for changing a market.
Necessary step
Elisabeth Thand Ringqvist, Senior Adviser at NTF Ventures and former CEO of Företagarna, thinks the center is a necessary, but not sufficient, step forward.
- There is currently a battle going on in Europe to become a fintech center and we know that other countries have invested an incredible amount in creating joint incubators and other types of cluster cooperation. I hope that we continue the talks with both Tillväxtverket and Vinnova to ensure that Sweden maintains a special position in Europe as a fintech center and this is the first important step.
She sees the Innovation Center for the financial market as an important signal from the state and believes that if those who work there are sensitive to what is happening, it will be easier to understand where the market is going and also to discover where and if it is rubbing somewhere.
- The lack of quick help has previously created a lot of frustration and a great demand to create some kind of so-called regulatory sandbox, a "safe" place to test innovations and more within the framework of the legislation, which exists in many other countries.
Eftersom FI believes that the most positive thing for the companies has been to enter into dialogue with the authority, they have instead chosen to concentrate on the Innovation Center for the financial market because it is believed to do the most good.
- Our supervision is risk-based and we want to give all companies an understanding of how they should be able to establish new services and what is required to test them on the market instead of inviting certain selected companies to a sandbox.
Multiple roles
The Innovation Center for the financial market came about as a results of the round table discussions that FI arranged last spring in collaboration with Vinnova and Transformator Design to be able to evaluate the fintech companies' needs. A total of about 80 companies participated, both large and small, established and startups. There it emerged, among other things, that many companies, for example, completely avoid contacting FI.
- It is something we are trying to meet and I believe that the dialogue we have now started can help the companies feel safer. For example, we can get better at being clearer and objectively explaining the opportunities and obligations that our various types of permits and registrations enable, says Stig Johansson.
Elisabeth Thand Ringqvist thinks it is interesting that FI's review shows that there are very few instances where current legislation would not work.
- This means that they have really listened to the various companies that participated in the round table discussions. The authority has also changed its attitude and realized that they can have several roles – a guiding and a control function – which is a big step.