On June 28, 2016, Germany’s Federal Financial Supervisory Authority (BaFin) hosted a new conference, BaFin-Tech 2016, in Frankfurt. The sold out conference was attended by around 200 participants representing FinTechs, investors and the broader financial sector. The aim of the conference was to explore regulatory issues that could affect young FinTech companies and new business models. BaFin-Tech consisted of panel discussions and smaller workshops where attendees could gain closer insight into specific themes like Blockchain, Robo-Advisory, Crowdfunding or alternative payment methods.
In his opening address, President of BaFin Felix Hufeld explained that they operate under the principal of same business, same risk, same rules. Hufeld continued, elaborating that, “Supervisors are not a jury delivering verdicts on business concepts. We don’t put up barriers to insulate established companies and we don’t run an incubator for cool newcomers. We are supervision and will remain so. However, what we do want, is to align our administrative procedures accordingly for you as a growing and increasingly more important audience. Accordingly means understandable, fast and, as far as possible, electronic.” Hufeld even invited promising business models which may fall below the required threshold to work with BaFin.
The second panel discussed whether FinTech is a disruption or an innovation. This conversation juxtaposed those in the FinTech sector like Dr. Oliver Vins of vaamo with established actors like Michael Mandel of Commerzbank. After this discussion, FinTech can arguably be characterised as inspirational. While the new innovations from the start-ups may shake up business models and customer demands, it also inspires the old guard to put their full weight behind their digitalisation efforts. Mandel detailed that Commerzbank’s efforts, like integration with PayDirekt, and the board’s goal to completely digitise the customer experience. The conference ended with a reflection from Hufeld, who reminded the audience not to overlook all factors that go into deciding whether a technology is permitted, such as security, anti-money laundering and consumer protection.
As the German FinTech scene has grown substantially over the past year, BaFin-Tech 2016 clearly demonstrated that Germany’s top regulators take FinTech seriously and are invested in fostering innovation in Germany and Europe’s financial sector. The event also proved another advantage of the Financial Centre Frankfurt for young FinTech companies looking for a home. Frankfurt is not just a centre for finance in Europe but also a centre for regulation and supervision, home to the ECB, EIOPA in addition to BaFin.
You can find more information and the presentations from the event on the BaFin website.