Overview

With the rise of the internet, the core banking sector has introduced significant digital facilitations to everyday banking, from enabling online transactions to providing solutions for cashless payments. Yet, with the introduction of open banking, financial service providers have revolutionized the way we do banking; the tech industry pioneers are creating a sophisticated Financial Technologies (FinTech) ecosystem with innovation at its center. The industry where FinTech providers operate is, however, a highly regulated one, presenting major compliance obligations.

Legal Services

Given the highly regulated nature of the industry, which has only recently opened up to new entrants, compliance requirements for FinTech providers are significant and concern the entire value chain (such as Banks, Payment Service Providers, Payment and E-money Institutions, merchants).

Some examples of regulatory requirements in the FinTech industry include:

  • License requirements for Payment Institutions (PI) and E-money Institutions (EMI) under PSD2
  • Application of Strong Customer Authentication (SCA) mechanisms by Payment Service providers (PSP) for online banking services performed through user-friendly customer interfaces and transactions taking place through payment gateways, to avoid risk of payment fraud or other abuses
  • AML compliance checks for KYC methods that include customer verification through AI-driven technologies
  • Transactions in Virtual Currencies (including through e-money and digital wallets), fall well within the regulatory scope of payment directives
  • Privacy concerns in online transactions are ringing the bell for increased technological and organizational measures to ensure compliance with Data Protection Regulation requirements

The ZK Law Team is highly experienced in providing legal advice on the implementation of regulatory requirements of industry players, including:

  • Supporting both industry startups and investors, VCs and funds in investment planning, contract negotiations, Shareholders’ Agreements and due diligence audits for investments and M&As
  • Licensing for Payment Institutions (PI) and E-money Institutions (EMI) under PSD2
  • Merchant and customer onboarding Service Agreements
  • Enabling eBanking and Mobile Payments services through agreements, T&Cs and policies for users, merchant and third-party providers
  • Incorporation and corporate planning of company Groups
  • Day-to-day corporate issues support
  • IP protection
  • Software licensing for the provision of services to or through third parties

Guidelines for product compliance with consumer law protection legislation