What is Your Biggest Compliance Challenge Today?

What is you biggest compliance challenge today? – I will tell you about mine

The biggest challenge I have, when taking on a new FinTech project, is to estimate how long things may take. How long it takes in compliance often means when the product will go live. So, it’s super crucial.

It’s not like I don’t know how long it will take to prepare a certain document set. In FinTech, you will always depend on the outcome of the regulatory reviews, results of the audits, approvals of your banking partners and how much resources you have.

Each of these elements and moving parts will slow things down (guaranteed L), even if your documents and products and processes are ready to go.

An average FinTech-bank partnership takes about 18-24 months to go live. An average payments or e-money license or money services business license takes about 6-8 -12 months to get approved. However, it’s impossible to rely on these numbers in reality, because things change.

Here are the most common slowdown factors:

• Summer or winter holidays and any internal restructuring or changes in management within large organizations. It’s likely there won’t be any major decisions during such times.
• Lack of resources and changing plans within FinTech organization. Many FinTech companies would like to have 20 licenses in all major global regions without realizing that each of the licenses will likely require resource allocation, setting up an office, hiring people, getting clear about local reporting, accounting and tax requirements. You need to choose 1-2 (maximum 3) licenses in your core markets and focus there.
• Switching gears. It happens sometimes that a startup company initiates a project, and after facing the first obstacle decides to change plans and start something else, assuming it would be easier. (E.g. you applied for the license in country XXX and 2 months later you received a list of 150 questions and requests from your regulator or banking partner, and instead of answering and addressing those, you decide to start something new, because you feel it would be easier and faster). Usually, it is never easier and faster elsewhere.

So, what’s your challenge these days?