When big techs and fintechs own banks

Following the 2007–09 financial crisis, big techs and fintechs started to offer financial services without the need for or interest in a banking license. More recently, tech firms have obtained banking licences in several jurisdictions to access low-cost deposits and to gain the credibility a banking licence affords. These developments have been facilitated by a conducive regulatory environment, where some authorities have set aside historical concerns regarding the ownership of banks by non-financial companies (NFCs) and allowed new classes of NFCs – such as tech firms – to own banks, in the hope of improving consumer outcomes. This paper assesses the merits of extending a banking licence to tech firms and explores their regulatory landscape in seven jurisdictions.

Please find the paper here and an executive summary here.