A British Fintech License or Another Jurisdiction?
The UK had long been considered the financial hub of Europe with its multiple advantages, including a transparent regulatory framework, simple laws, benefits and minimum of red tape. Britain offered appealing conditions to sole proprietors wishing to obtain a fintech license.
With Brexit, however, many businessmen are now reassessing the expediency and convenience of the British fintech license. This article offers a detailed overview of how relevant it is to obtain the fintech license in the UK.
Fintech license: prospects of the British fintech market
You must have heard about the process of passporting: if you have a license issued in one of the EU countries, you need not receive it in the other member states. You simply send the required documents to the other EU country’s regulator requesting to include you in the list of companies operating in their territory.
As the EU member, Great Britain was a participant of the Single Euro Payments Area (SEPA). After Brexit the British fintech market may be deprived of the passporting procedure and SEPA membership. The UK shall remain a full SEPA member till December 31, 2020, but what happens next?
Many fintech companies have already exited the British market or intend to do so. Major financial companies mostly “move” to Dublin, Luxembourg, Frankfurt and Paris. Besides, other EU countries have begun to draft local fintech regulations, preparing to welcome British companies.
Some fintech businesses have already obtained their licenses in other European states, e.g. Lithuania, although there are companies playing a waiting game. So what is the advice for fintech projects only planning to obtain a fintech license in British?
A British fintech license – how relevant is it?
The British fintech market is complicated and peculiar but extremely professional. The British government is aware that the fintech industry is one of the main income generators for the British economy. The Chancellor of the Exchequer Philip Hammond previously announced that the country would fight for the fintech industry’s opportunities and make the most of them.
If you are targeting residents of Great Britain, you should certainly proceed with the British fintech license. Otherwise, it is worth considering other jurisdictions to avoid issues in the future.
SBSB International Law Firm has over 6 years of successful experience in obtaining fintech licenses in various jurisdictions, including the UK. We offer legal support of fintech projects on a turnkey basis, from company incorporation to monthly legal follow-up and assistance with recruitment.
Our experts will help you choose a perfect jurisdiction for your business. You tell us about your idea, and we will ensure its full implementation in the regulatory framework! Join our Telegram chat to get a free online consultation.