Big Tech’s FinServ Moves Prompt EU Regulatory Probe

Moves on the part of Amazon and Google to enter the financial services market is prompting European financial regulators to mull whether or not the tech companies need to be supervised.

According to a report in the Financial Times citing Olli Rehn, governor of Finland’s central bank and a member of the European Central Bank’s governing council, the issue of tech companies entering the financial services industry has resulted in a “very lively discussion by financial supervisors and central banks in Europe.” The comments were made at the Financial Times Middle East Banking Forum being held in Dubai. It was well received by senior bankers, reported the paper, noting many have complained that it’s not an even playing field when competing against technology companies.  The report noted it could also mark a new fight between tech companies and European regulators, which have been going after them over data breaches and to get more taxes out of the tech giants.

Rehn was asked if the ECB was mulling regulation for the tech companies that have entered financial services and said in response: “we see big tech is moving in there,” adding that it was “currently a matter for discussion among financial supervisors,” reported the Financial Times.

The comments come as the big tech companies in the U.S. including Amazon, Google, Facebook, and Apple have been entering the financial services market by supporting digital payments and launching other services. Tencent and Alibaba in China are also leaders in digital payments and are expanding into financial services as well.  Earlier this year financial regulators in the EU opened up banking to FinTechs, requiring lenders to provide access to accounts of customers that authorized third parties to have access.  European banks are concerned that U.S. and Chinese technology heavy-hitters will enter the best parts of the financial services market and not face the same regulation to which they are subject.