4.1 Does your jurisdiction regulate the collection/use/ transmission of personal data, and if yes, what is the legal basis for such regulation and how does this apply to fintech businesses operating in your jurisdiction? The highest major publicly announced investment in a Fintech firm in Ghana stands at $17 million investment in Float. The circular highlighted the growth of active mobile money agents in the same period to 465,000 (compared to 235,000 the previous year ). For fintechs, the future is promising. In this time, we've studied both FinTech regulations and data protection laws like GDPR. In such cases, where a Fintech company is regulated by another regulatory agency, the Bank will enter into a Memorandum of Understanding with the relevant regulator. FinTech is seen by regulators in the region as a tool to support efforts for financial inclusivity and economic growth. Ghana is second largest economy in West Africa, a lower middle income country, and has a population of about 30.42 million with a GDP per capita of USD 2,225 as at 2019. Guidelines have also been formulated to encourage best practices among financial institutions. This has changed, and fintechs in most countries are now regulated by main national financial regulators. Fintech solutions are more vulnerable than digital solutions in other sectors because they store personal and financial data and perform money transfers. GLI - Fintech 2022 covers approaches and developments, the Fintech offering in each jurisdiction, regulatory and insurance technology, regulatory bodies, key regulations and regulatory approaches, restrictions, and cross-border business - in 26 jurisdictions. Progress of Fintech in Ghana. Prior to this, Mr Nagatsuka has worked in the field of capital markets regulation for over 15 years, and was previously Head of the Capital Markets Policy Division responsible for policy formulation and reviewing legislation in relation to capital markets and market infrastructures. Fintech businesses are involved in insurance, agriculture, banking, pensions and investment services. Digital commerce in Ghana: opportunities focused on innovation for micro and small enterprises (MSEs). U.K. regulators have determined the existing regime to be adequate compared to the new EU regime, which position aligns with the post-Brexit trend for the U.K. to steer its own course in the regulation of fintech companies rather than mirror regulatory efforts in the EU. As noted earlier, FinTech goes beyond the payment systems and services with which the customer directly interacts. The move appears to be a nod toward more regulations in China's burgeoning fintech sector. Global fintech investment reached a staggering USD $98 billion in the first half of 2021, compared with USD $121.5 billion in the whole of 2020. The speed and complexity that this new wave of fintech has expanded throughout North America and the world, in just a few years, has created regulatory challenges for authorities in the U.S. and Canada. MAS establishes rules for financial institutions which are implemented through legislation, regulations, directions and notices. But the future also brings increased exposure to regulatory requirements, sanctions, and legal actions. The background: Supported by some robust regulations and the huge success of Safaricom's M-Pesa, digital payments in Kenya has been growing in leaps and bounds. However, limited research theorises how new entrants and incumbents work together in FinTech ecosystems to shape financial inclusion. In early 2019, Ghana regulated institutions and businesses that provide payment services and mobile money operations called the Payment Systems and Service Act. Fintech Compliance Regulations: Tips For Effective Risk Management. 7. Ownership structures show that while some Fintechs are set up with Ghanaian and foreign capital, a majority of entities in the sector are Ghanaian owned. Jamie Campbell shared his experience in the regulation seminar organized by BBVA Bancomer and the Inter-American Development Bank (IDB). The Government of Ghana, through the Ministry of Trade and Industry is currently implementation a national Business Regulatory Reform Programme as one of the key interventions to create an investment-friendly, transparent and predictable policy environment in Ghana. Malta is expected to have new developments with regards to regulations, especially dealing with DLTs and token offerings. MindK has been working for more than 10 years with companies that provide financial services. Regulators have also observed FinTech supporting COVID-19 relief efforts through digital payments, the delivery of government relief and stimulus funding, and support in healthcare applications. The regulation of the fintech industry is more complicated than for financial institutions. 3.16 An initially relaxed regulatory environment also contributed to the rapid take off of Fintech development in China. Similarly, the United States intends to offer a unified regulatory framework for Fintech in the near future. According to Section 3 of the Payment and Services Act, 2019 (Act 987), the regulator of FinTech in Ghana is the Bank of Ghana. Research from The FinTech Times also estimates that there are around at least 70 fintech solutions in the country with many fintech startups springing up every second. They are usually only set in response to actions made by you which amount to a request for services, such as setting your privacy preferences, logging in or filling in forms. Regulatory compliance in the financial sector implies strict adherence to policies and regulations surrounding the regulatory and supervisory environment of financial institutions. Since then, the region has become a hotbed for FinTech activity and regulatory development, with several jurisdictions competing to establish themselves as the FinTech hub in the region. @wef (): Global COVID-19 data tracks FinTech's pr.. , , . The fintech industry has seen a convergence of actors cooperating and competing to drive growth. In response to the increasing importance of FinTech, financial regulators have put in place different schemes to address innovation. Regulatory-wide, Singapore has been one of the most active and supportive jurisdictions in Asia in this regard. Federally-regulated financial institutions and intermediaries in Canada have adopted and embraced Fintech to improve back-office functions, such as settlement and clearing and loan approvals, and have partnered with Fintech companies to provide customers with more convenient products and services. The book observes the technological evolution of finance that lies between the regulated market and the illegal circulation of capital. In this notice, the bank alerts the public to the absence of regulation in the use and trade of virtual currencies and other related blockchain technologies. MAS is the integrated regulator and supervisor of financial institutions in Singapore. It is important to note that the evolution of Nigeria's fintech sector has been guided by regulatory and policy developments. Looking forward to presenting next week on FinTech Regulation in Kuala Lumpur, Malaysia for the 2018 International Law Conference entitled. As part of a pilot program in collaboration with EMTECH Service LLC, the Bank of Ghana has launched a regulatory and innovation sandbox. Jumia, Africa's leading ecommerce ecosystem looks at ways in which fintech is driving the growth of ecommerce in Ghana. This is according to stakeholders that spoke during TechCabal's recent event: "The Fintech Series: Regulation and Innovation - Finding common ground". The Act states that the Bank of Ghana shall have overall supervisory and regulatory authority in all matters relating to payment, clearing and settlement systems. Ghana's fintech landscape is evolving. There's now the so-called regulatory technology (or regtech) that functions to help IT-based industries like fintech to better comply with regulations. The emergence of regulatory (new principles and detailed rules and guidance) and supervisory responses to these fintech risks. 4.1 Does your jurisdiction regulate the collection/use/transmission of personal data, and if yes, what is the legal basis for such regulation and how does this apply to fintech businesses operating in your jurisdiction? The report is a great example of a large bank embracing the role of regulation in the development of a healthy fintech ecosystem. With the ongoing antagonistic regulatory regime, fintech is taking a more proactive approach to achieve better, trouble-free diffusion. What is a sandbox? In this notice, the bank alerts the public to the absence of regulation in the use and trade of virtual currencies and other related blockchain technologies. The Bank of Ghana as the regulatory authority of fintech activities has issued a notice on digital and virtual currencies operations in Ghana. The threat of COVID-19 and the waiver on mobile money fees only seems to have increased mobile money transactions. The majority of respondents consider Fintech a priority. the Gramm-Leach-Bliley Act (GLBA), Dodd-Frank Act, and Fair Credit Reporting Act (FCRA), due to rapid developments in FinTech. Because of the diversity of offerings in fintech and the disparate industries it touches, it is difficult to formulate a single and comprehensive approach to these problems. The Global Covid-19 Fintech Regulatory Rapid Assessment Study, which involved regulators from 118 central banks around the world, found that 72% of regulators accelerated or innovated digital infrastructure in response to the pandemic. In this Article, the author seeks not only to discuss the inclusion of Fintech companies in the economic framework of Ghana but also discuss the new Payment Systems and Services Act 2019 (Act 987) which is aimed at ensuring a stronger legal framework within the Fintech industry. ExpressPay was founded in 2012, and for more information about ExpressPay, you can email them at; info@expresspaygh.com, and located at 12 Senchi Street, Airport, Ghana. The intervention of fintech into the area of financial services has not only resulted in multiple innovative products and services appearing in the market, but also brought some challenges to fintech firms themselves. This database consists of nearly 200 countries around the globe primarily to serve client and staff needs to be able to access, compare and contrast fintech related regulation globally. The First Deputy Governor of the Bank of Ghana, Dr. Maxwell Opoku-Afari, says the regulatory environment for fintech has been revamped to ensure a more competitive and innovative industry. These cookies are necessary for the website to function and cannot be switched off in our systems. A report by YES Bank, a private Indian bank, into domestic fintech development has encouraged strong regulatory support of the nascent industry. and others are examples of such laws and regulations. Government regulations on e-money and mobile money technologies are favourable and aiding adoption and rolling out of new technologies every day targeted at the unbanked population. This fast and global growth of the Fintech industry doesn't come without challenges. From P2P to mobile payments to cryptoassets and more, it insightfully traces the successes and shortcomings of China's regulatory responses over time and examines prospects for reform. In the next chapter, we will explore how these changes have supported the early stages of fintech and how regulators are crafting appropriate regulation for the next wave of growth. Switzerland has no specific prohibitions or restrictions in place with respect to fintech. Despite having one of the largest fintech industries in the world, the US is noticeably behind other regions when it comes to one factor crucial to the future growth of this burgeoning sector regulation. FinTech regulatory regimes started emerging in the Gulf region1 in 2017. This book provides a comprehensive overview of the FinTech phenomenon and the current regulation planned by the EU, US, and UK authorities. An overview of Fintech in Ghana. These can be broadly split into three different categories according to a recent publication by the BCBS: (i) innovation hubs, (ii) accelerators, and (iii) regulatory sandboxes. But fintech presents a unique set of regulatory difficulties that are less prevalent in more traditional forms of finance. Policy seems to be developed in reaction to emerging technology advancements; but generally, the policies have been cautiously receptive. A pilot project in Canada suggests that these potential benefits will take time to realise, however, and that working around regulations will be a bigger hurdle than perfecting the technology "The bank has not considered making regulatory changes in order to facilitate a change to DLT," says Mr Hendry. The hearing was called to address what Task Force Chairman Stephen Lynch called "serious gaps" in the current regulatory scheme, e.g. The US regulatory environment is holding back fintechs and hindering their chances of success. This is a one in a million fintech that supports agriculture in Ghana and offers farmers to own part in agriculture's value. Like in much of other parts of Africa, Ghana's fintech can be most visible to the public with respect to the popularity of mobile devices and mobile money specifically. 2020 . While the early days of the fintech revolution were characterised by start-ups taking on and beating incumbents, in 2018 there is notably more market cooperation. Regulations applicable to fintech businesses in India are complex and evolving. The Landscape of FinTech Regulation. However, there is a large disparity across jurisdictions in the region, both economically and in their approach to financial services regulation. In 2018, ASBA distributed among its members a survey1 regarding the response of regulators to the irruption of Fintech in their financial markets. If passed, it will create a framework for open banking and introduce regulations designed to foster competition and innovation in the financial services sector. An alphabet soup of regulatory agencies such as the CFTC, SEC and others have struggled to wrap their heads around regulating blockchain, cryptocurrencies and other fintech innovations. It has created the Malta Digital Innovation Authority, responsible for the regulation and incentivisation of the aforementioned industry in both Malta itself and the EU as a whole. The answers were analyzed to understand the approaches and future actions in terms of financial regulation and supervision. Following the passage of PSSA Act 987, the Bank of Ghana will issue clarifying regulations on issues such as applicable services and institutions, licensing requirements and procedure, technology standards etc. Guo Shuqing, chairman of the China Banking and Insurance Regulatory Commission (CBIRC), hinted "timely and targeted measures to prevent new systemic risks", in a nod toward further regulation. This Act enabled direct licencing of non-banking sectors and FinTechs by the Bank of Ghana. Some advocate moving from an entity-based to an activity-based regulatory approach under the principle "same activity, same regulation". Kwidex. (www.chambers.com) As a result there are plenty of potential avenues for fintech companies to be involved in Ghana's growing fintech marketplace. It has become evident to a number of governments that banking and financial services will keep on moving towards greater digitalization. According to the bank's statement, the sandbox, which was developed in conjunction with Emtech Solutions Inc, is open to all regulated financial institutions in Ghana. This means that FinTechs wishing to operate in Indonesia have to connect to the NPG network. Ghana's medium-term economic prospects are positive, with economic growth expected to accelerate to 8.6 percent in 2020. The British fintech firm, Bud , was one of the companies the Financial Conduct Authority (FCA) invited to participate in the first 'regulatory sandbox'. China has been promoting blockchain technology, collaborating with the telecommunications giant Huawei to push the research in this field even further and has even been investing worldwide in new Fintech startups. So what are the FinTech compliance regulations around the world and how can you use them to your advantage? It becomes the base hub where innovation and growth in the fintech landscape could be explored." In many of the jurisdictions surveyed in this Report, there has been a focus on conduct regulation. The Monetary Authority of Singapore has also formed a FinTech & Innovation Group responsible for regulatory policies and development strategies to facilitate the use of technology and innovation in the financial sector. The NPG network is operated by standards institutions, services institutions and switching institutions, which are approved or appointed by the BI. In this post, we'll overview the major fintech compliance regulations and the most common challenges. Despite the fractious relationship, regulators and innovators share similar goals, and thus, there's a natural common ground between both parties. In Ghana, some notable FinTech start-ups include Express Pay, ZeePay, Hubtel, Paysail, DigiTeller, etc. of the EMI Guidelines, as well as ensure the regulation of certain FinTech firms. This is made to avoid monopoly practices in the payment system. The leader of our financial regulation practice in Singapore, Peiying Chua commented: "This initiative will enhance the conduct of crypto-asset and blockchain companies in Singapore and further cement Singapore's reputation as a leading jurisdiction in the blockchain and fintech space." In the context of FinTech, prudential and conduct regulation tools and methodologies often cohabit within sandboxes, innovation hubs and new rule making. The possibility of such externalities, and related market failures, suggest that government regulation to contain the risks of inefficient and harmful behavior in fintech is essential. Regulation of the FinTech sector strands several regulators, including the Bank of Ghana, National Pensions Authority, National. The Fintech space in Ghana is gradually picking up steam with active participation from the public and private sectors. have inhibited digital financial inclusion (DFI).6 This paper discusses the state of DFI in Ghana and the regulatory framework for DFS, with particular attention paid to mobile money services as the major DFS player in the country and to the government's digital security strategies in relation to DFS. Fintech regulation in Asia. Fintech has many potential risks. Information was collected from mostly desk-based review and is supplemented by our in-country knowledge. 5 . We asked the FinTech startups in the alumni of Startupbootcamp FinTech Singapore what burning questions they had for a FinTech lawyer and in this article, lawyer WanHsi Yeong from ArrowGates LLC simplifies and demystifies regulation around FinTech in Singapore, and offers practical advice. 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