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Fintech Compliance Challenges in Sweden: Experts Weigh In on Global Trends

As the financial technology (fintech) industry continues to evolve, Swedish fintech companies are facing unique compliance challenges. According to a recent report by KPMG, embedded finance, regulatory scrutiny, data-driven strategies, ESG-focused initiatives, and deal-making in underdeveloped regions are some of the top trends shaping the global fintech landscape.

  • Embedded finance: The trend of embedding financial services into other products or services
  • Regulatory scrutiny: Increased oversight as embedded finance becomes more prevalent
  • Data-driven strategies: Using data to drive business decisions and improve operations
  • ESG-focused initiatives: Environment, Social, and Governance (ESG) focused fintechs prioritizing sustainable investments
  • Deal-making in underdeveloped regions: Investors targeting emerging markets such as Africa, Southeast Asia, Latin America, and the Middle East

Expert Insights from KPMG’s Karin Sancho

Karin Sancho, Head of Financial Services at KPMG in Sweden, weighed in on these trends from a local perspective:

  • “In Sweden, we’re seeing banks interested in delivering services to other distributors,” she said. “However, many non-bank players are also looking to embed financial services into their offerings.”
  • On regulatory scrutiny: “The question is how local authorities will keep up with the development… We’re also seeing business models change on the back-office side, and there will be increasing regulatory scrutiny of new service provisions and outsourcing.”
  • On data-driven strategies: “Most fintechs here have had a clear focus on data for a long time.”
  • On ESG-focused initiatives: “Swedish ESG-focused fintechs should look to expand geographically to tap into global demand.”
  • On deal-making in underdeveloped regions: “This could impact access to capital for Swedish fintechs, emphasizing the need for them to expand into these regions.”

Compliance Challenges for Swedish Fintech Companies

As Swedish fintech companies navigate these trends, they must also contend with compliance challenges:

  • “Fintechs in Sweden need to be aware of the regulatory landscape and ensure that they are compliant with relevant laws and regulations,” said Sancho.

Note: Unicorn status may lose some of its allure in developed markets, but remain a key benchmark for startups in emerging markets. However, this trend is less relevant for smaller markets like Sweden due to their limited market size.