Moving The Goalposts: U.K. And U.S. Trends In Fintech Bank Licensing

The dominant fintech narrative for the Canadian banking industry shifted in 2016 from a new entrant versus incumbent storyline to one of collaboration, as major Canadian banks continued to partner with new technology entrants. The intent of these partnerships varies but they generally aim to expand the incumbent bank's customer service offerings, improve its customer/user experience (or UX) or accelerate its learning curve in a specific technology.

In the meantime, other jurisdictions, notably the U.K. and the U.S., have made it (or are proposing to make it) easier to obtain a banking licence, likely leading to more direct competition in the retail banking space between new technology entrants and incumbents. Below, we look at what banking regulators are doing in the U.K. and the U.S. to move the goalposts for fintech banking entrants and conclude with some thoughts on how this might impact the competitive landscape.