What is fintech?
Fintech, or financial technology, is the term used to describe any technology that delivers financial services through software, such as online banking, mobile payment apps or even cryptocurrency. Fintech can be powered by the most basic technologies, like the Internet and mobile apps. It can also be powered by the very advanced, which has the potential to disrupt and revolutionise financial services, like blockchain and AI.
The finance and payments industry has, and is still, undergoing massive transformations from recent innovations in technology, as seen in the emergence of:
- Buy Now Pay Later (BNPL);
- Decentralised Finance (DeFi);
- Open Banking;
- Robotic Process Automation (RPA);
- Voice-enabled payments;
- White label fintech solutions;
- Data aggregation;
- Digital banking; and
How big is it?
Fintech businesses have proved to be a significant part of the international startup and scaleup scene with some key players stepping up as major market disruptors.
Globally, financial technology is projected to reach a market value of $305 billion by 2025, according to Market Data Forecast. Part of this growth is driven by partnerships between fintech companies and banks. According to Cornerstone Advisors, 65% of banks and credit unions entered into at least one fintech partnership over the past three years, and 35% invested in a fintech startup. Banks that partnered with fintechs averaged 1.3 partnerships per institution in 2019, which grew to 2.5 partnerships in 2021.
How Biztech can enable fintechs?
There is no “fintech-specific” regulatory framework, but fintech companies are potentially subject to various state and federal laws. Successful fintech companies must be legally savvy. They must invest significantly in robust policies and procedures to ensure compliance with consumer protection and data privacy laws that govern financial institutions. This is important to please potential regulators and also to effectively partner with other financial institutions who are heavily regulated.
Naturally, new and tightened regulations have emerged and will continue to do so to address the disruptive effects of technology. The quick evolution of the traditional finance sector into one with many fintech solutions, means regulators are only just beginning to keep up. We do expect, though, to see more processes and systems regulated as the fintech space grows.
The innovative nature of fintech businesses means that the legal challenges faced are often unique. Finding the right legal solutions to each set of issues requires a creative and innovative approach that truly responds to the product and service of the business as well as its place in the wider fintech landscape.
Biztech’s fintech expertise
Biztech Lawyers has advised some of the hottest players in the fintech industry. We provide quality legal solutions to fintech businesses, adapted to the changing regulatory landscape. We tailor our services to our client’s particular needs. We help fintechs structure products and services, as well as compliance procedures. This enables fintechs to effectively navigate the regulatory maze and capitalize off strategic partnerships with banks and other financial institutions.
Our global team is ready to enable any fintech business, with its sights on domestic and international markets. Our fintech clients range from service providers in BNPL, NFTs, Managed Investment Schemes, Private Equity, mortgage broking, and receipt automation.
We support Fintechs with:
- Company setup;
- Regulatory setup, compliance and governance;
- Intellectual Property, including trademarks, copyright, IP licenses and assignments;
- Partnership, merchant and vendor Agreements;
- Capital raisings, VC and crowdfunding;
- Mergers and acquisitions;
- Addressing finance regulations, including KYC and AML;
- Data Privacy and Info-Sec; and
- Responding to State and federal government investigations and enforcement actions.
Featured Fintech Clients
Acquisition (Sell Side)
Provided sell-side transactional support for Quadpay in its acquisition by ASX-listed Zip Co Ltd.
Acquisition (Sell Side)
Provided sell-side support for Cannon Trading’s acquisition by Openmarket Group for A$12.5 million.
Advised Practice Ignition on their Venture Debt Round.
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