SEC Launches FinHub to Support Fintech and Digital Finance Innovation
On October 18, 2018, the U.S. Securities and Exchange Commission (SEC) announced the launch of FinHub, its Strategic Hub for Innovation and Financial Technology. FinHub was created to serve as a central resource and point of contact for fintech innovators, including companies building digital marketplace financing platforms, API-based financial services, and distributed ledger technologies.
The hub aims to facilitate engagement between the SEC and market participants developing new financial technologies, providing guidance on regulatory compliance. FinHub consolidates the SEC's existing efforts across divisions to address fintech-related matters in a more coordinated fashion. The launch signals growing regulatory recognition of the transformative impact of fintech and embedded finance on capital markets.
For BaaS and API-based banking platforms, FinHub represents a clearer pathway for regulatory engagement when their products intersect with securities regulations.
- Provides clearer regulatory engagement pathway for BaaS and embedded finance platforms touching securities products
- Signals US regulatory willingness to accommodate fintech innovation rather than solely enforce existing frameworks