Shaanil Senarath-Dassanayake and Mike Barrington write in Finextra about regulatory themes every FCA-authorised fintech leader should be watching

The UK’s fintech sector is world-leading, but as it continues to expand, growth without governance is one of the fastest routes to enforcement.

High-growth ambitions require capital, which requires confidence. Prospective investors in fintech businesses will look under the bonnet, so it is important for board directors and advisers to have major regulatory themes on their radar, to navigate growth with the right governance and controls.

Rapid customer growth without corresponding investment in financial crime controls can attract regulatory action. It is also crucial to build out a board fit for a regulated firm, with thoroughly implemented and documented governance and decision-making processes.

The personal accountability of senior managers under the Senior Managers and Certification Regime is also important to monitor, alongside duties under the Companies Act. 

Operational resilience is particularly relevant for fintechs, whose platform is the product. The FCA has been supervising and reviewing regulated firms' operational resilience, so scaling fintechs should be proactive in their stress-testing and incident reporting.

Shaanil Senarath-Dassanayake, Associate in our Financial Services, Regulation & Funds team, and Mike Barrington, Senior Associate in our Corporate team, write in Finextra:

For those considering a fintech board appointment for the first time: before accepting, ensure you are comfortable with the quality of information routinely shared with board members, and ask to see compliance management information and the operational resilience self-assessment. What you do or do not find will tell you a great deal.

Read the full article in Finextra here.