New York, France Sign MoU for FinTech Regulation and Development
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New York, France Sign MoU for FinTech Regulation and Development

What's the impact on FinTech in the US?

A report from June 8, 2020, has revealed new steps taken by New York and France to facilitate the fintech industry. This step was the signing of a Memorandum of Association that will allow cross-market penetration. The MoU was signed between the New York State Department of Financial Services (DFS) and Autorité de Contrôle Prudentiel et de Résolution (ACPR).

New York and France Sign FinTech MoU

With this document signed, fintech industry players from both places will be able to enter the other’s market with ease. This is mutually beneficial for both New York and France as they will be able to maintain their positions as global fintech hubs. The MoU was formally signed on June 3, 2020.

While this new development will aid fintech firms and startups in both places, it is not the only benefit attached to it. Information regarding regulation and policy will also be exchanged between the two bodies in question. This will ensure mutual support and also access to information and best practices for policy and regulatory issues.

According to Villeroy de Galhau, the chairman of the ACPR, this deal benefits all within the ecosystem. It not only connects two major fintech hubs but also helps to provide innovative products and services in both countries. This, he says, benefits consumers, corporates, and the wider economy.

New York’s Superintendent of Financial Services, Linda A. Lacewell, reiterated this point by noting that this development will give speedy access to new markets for entrepreneurs. This comes roughly a year after the DFS became the first United States banking regulator to join the Global Financial Innovation Network. This also marks the first agreement signed by the ACPR regarding fintech with an American regulatory body.

New York’s Strides in Blockchain Development

It is not a great surprise that New York as a city, would enter into a deal to support the fintech industry. It has generally been very forward-thinking with regards to innovations such as blockchain and cryptocurrency. For instance, the city introduced BitLicense in 2015, which aided in the regularization of digital asset firms and has granted this license to investing firms such as SoFi.

In September 2019, New York announced the creation of a crypto task force that was formed to advise on cryptocurrency regulation. The official body, which was approved by New York governor Andrew Cuomo in August 2018, was the first in the US to be dedicated to digital asset regulation. The force is comprised of consumer advocates, technologists, investors, blockchain advisors and companies, and academics.

It has not always been smooth sailing, however, as a few blockchain developments have failed. For example, a proposed tokenization deal for luxury real estate in New York was quietly canceled in 2019. At the time, this was the second deal of its kind, not to see the light of day.

Do you think this deal will be beneficial for both associations? Will fintech as a whole benefit from more cross-market collaborations between regulatory bodies? Let us know your thoughts below.