US regulators are playing catch up to the rest of the world when it comes to leveraging financial technology.
FINRA, the Financial Industry Regulatory Authority, recently held its Buildathon: a sort of Hackathon.
From the sidelines, FINRA’s podcast, Unscripted, held its most recent podcast.
Three guests were invited: Kevin McGovern, managing partner of Deloitte’s New England office; Charles Senatore, senior advisor at Fidelity Investments’ Devonshire Investors unit; and Haimera Workie, the head of FINRA’s Office of Financial Innovation.
Workie explained what the Buildathon was, “The Buildathon is really an opportunity for us to partner with various stakeholders of the financial industry to try to solve concerns related to investors. Right, so, it’s challenges that basically affect the day to day lives of investors and pulling resources from across the industry.”
Senator explained how the Buildathon was different from a typical Hackathon.
“A lot of the hackathons that you have would be, basically, you have student groups that are looking to do something that is interesting or you even have somewhere the industry group that is looking to do something different. This is one that actually brings together those various parts that actually work together.”
McGovern added that it’s not a Hackathon because no one is hacking but trying to build.
Workie noted that several foreign regulators have been more forward-moving thus far on technology, innovation, and collaboration.
“There are models in terms of engagements like this in other countries that may have taken some steps ahead of us,” he stated.
When asked which regulators had moved forward before the US, he said: the Financial Conduct Authority in England, the MAS in Singapore, and the Canadian Securities Association in Canada.
Workie further noted that this does not mean that in the US regulators have taken financial technology lightly.
In fact, since President Trump has taken office both the Securities and Exchange Commission (SEC) and the Commodities Futures Trading Commission (CFTC) have both created offices for financial innovation.
The SEC launched its Strategic Hub for Innovation and Financial Technology in October of 2018 while the CFTC introduced LabCFTC in May 2017.
FINRA launched its Office for Financial Innovation which Workie heads in April of 2019.
McGovern noted of the relationship between regulators and companies on financial technology, “If and when we do see regulators and companies more collaboratively, I would hope that the speed to solutionizing is faster.”
FINRA”s Buildathon was held on November 8-10 in Boston.
Deloitte recently put out a white paper on the possibilities of financial technology collaboration between big traditional companies and small start-ups entitled “Closing the gap in fintech collaboration Overcoming obstacles to a symbiotic relationship.”
That paper can be found here.
