Are Fintechs Prepared for More Regulatory Scrutiny? Questions Fintech Boards Will Want To Ask
Key Points The 2024 elections may usher in laws and regulations that impact fintechs, making it important for management to identify the areas that present the greatest challenges and opportunities. As fintechs grow, they should consider whether they have all necessary licenses to operate and whether existing compliance and risk management infrastructure should be augmented […]
Posted by Mark Chorazak and Adam J. Cohen, Skadden, Arps, Slate, Meagher & Flom LLP, on Sunday, September 15, 2024
Editor's Note:
Mark Chorazak and Adam J. Cohen are Partners at Skadden, Arps, Slate, Meagher & Flom LLP. This post is based on their Skadden memorandum.
Key Points
- The 2024 elections may usher in laws and regulations that impact fintechs, making it important for management to identify the areas that present the greatest challenges and opportunities.
- As fintechs grow, they should consider whether they have all necessary licenses to operate and whether existing compliance and risk management infrastructure should be augmented to be “fit for purpose.”
- Bank-fintech partnerships are under the regulatory microscope. Fintechs that rely on bank partners should evaluate how their business models could be affected if partnerships are terminated or no longer available on existing terms.
- Reliance on a few counterparties and providers raises concentration risk and operational resiliency issues. Fintechs should prioritize the development and regular testing of contingency plans.
