Over the past decade of rapid fintech development, startups and entrepreneurs in the market have called for practical and economical regulatory frameworks that could enable financial products and services to scale with the market’s growing clientele. Still, the government and regulators globally struggle to establish regulations for new generation financial services.
The core issue behind the government’s inability to establish reasonable regulatory policies and its obscure mentality towards financial technologies is the direct effect of divided and conflicting regulations to fintech startups.
Fintech service providers and financial network developers often focus on the development of cross-country and cross-network payment models, in which users can send or receive payments to or from abroad. There are also other major fintech businesses such as digital currency trading, transaction settlement, and financial management.
Ultimately, these financial operations heavily rely on user data and transfer of money. However, these operations are subjected to similar or identical financial regulations dealt by banks and major financial institutions, which essentially requires financial service providers to record and present any relevant user and financial data to government agencies when “necessary.”