Banque de France comes to the defense of fintechs. On the occasion of a day of reflection dedicated to fintechs, the Autorité des marchés, the Banque de France and the government called banks to order, insisting on the importance of collaboration with fintechs, following recent tensions over open banking.
Collaboration with fintechs: banks called to order
Monday October 11 saw the annual Fintech Forum, organized by the Autorité de contrôle prudentiel et de résolution (ACPR) and the Autorité des marchés (AMF). The event brings together numerous fintechs, the Banque de France and the French government.
Introducing the event, Banque de France Governor François Villeroy de Galhau reminded banks of the importance of working with fintechs, which he described as " key players " in the financial sector, and which they intend to modernize through their various innovations.
" I call on banks to support the transformation of the financial system constructively, without excessive fear," said François Villeroy de Galhau, who believes that the real threat comes from the GAFAs. " If banks and fintechs didn't each know how to innovate, and often innovate together, the big techs would pick up the slack," he added.
For his part, Cédric O, Secretary of State for Digital Transition and Electronic Communications, has called for us to ask ourselves " how we can, together, move faster ", rather than trying to resist " the emergence of new players ".
The Autorité des marchés financiers (French financial markets authority) took a similar stance: its chairman, Robert Ophèle, raised the issue of regulation. For him, while regulation should not be aimed solely at protecting banks at the expense of fintechs, it does need to be strengthened to avoid blockages and tensions.
Banks and fintechs: tensions surrounding open banking
This call to order, issued by financial regulators and the government to the banks, follows the tensions generated by recent remarks by Nicolas Théry, Chairman of the French Banking Federation (FBF).
In an interview with the French daily Les Echos at the end of September, Nicolas Théry said he didn't believe in open banking, which allows non-banking players, mainly fintechs, to access the customer data of various banking establishments. Thanks to this data, collected with customer consent, fintechs can develop applications and new services.
Since the second European Payment Services Directive (PSD2) came into force in 2018, open banking has been an obligation for banks, something that the President of the French Banking Federation seems to regret, believing that " the requirement for confidentiality and digital privacy are non-negotiable", adding that " banking data should be inalienable ".
The FBF's stance drew strong reactions from fintechs, who expressed their views in an article published by the France Fintech association. For them, these comments were from another era, and took them " several years back in time ". They also pointed out that they are " regulated and supervised by the same regulators as banks ", namely the CNIL, AMF and ACPR, a further guarantee of bank data protection.
However, the position of the President of the French Banking Federation is far from shared by all banking players. Crédit Mutuel Arkéa, for example, recently reiterated its interest in open banking, while the head of the BPCE group, Laurent Mignon, said he was more concerned about GAFAs than neobanks.
In the United States, some banking groups have allowed themselves to be seduced by collaboration with GAFA, and are already beginning to bitterly regret it. Several American banks are demanding a reduction in the commissions they pay Apple for each transaction carried out via the Apple Pay payment service. The battle promises to be long and the outcome more than uncertain.