Financial Crime World

Regulatory Framework for Fintech Companies in Sweden

Sweden has a well-established regulatory framework that governs the operation of fintech companies and alternative finance products or services. The following sections outline the key regulations and requirements for various types of financial activities.

Consumer Credits

  • High-Cost Credits: High-cost credits with interest rates above 30% are regulated by the Interest Act.
    • Marketing requirements include moderation, restraint, and neutrality.
    • Fintech companies providing high-cost credits must comply with regulations.

Collective Investment Schemes

  • UCITS (Undertakings for Collective Investment in Transferable Securities): Regulated by the UCITS Act.
  • Alternative Investment Funds (AIFs): Regulated by the Alternative Investment Fund Managers Act (AIFMA).
    • Fintech companies providing AIF services must comply with regulations.

Crowdfunding

  • Regulation (EU) 2020/1503 on Crowdfunding Service Providers: Establishes a harmonized framework for crowdfunding service providers in the EU.
  • Shares in Swedish Private Companies: Cannot be admitted instruments for crowdfunding purposes due to the Companies Act.

Invoice Trading

  • Companies Participating in Invoice Trading: Must register their operations with the SFSA and comply with Anti-Money Laundering (AML) regulations.

Payment Services

  • Regulated under Directive (EU) 2015/2366 (PSD2): Sweden has implemented PSD2 through the Payment Services Act (PSA).

Open Banking

  • Account Servicing Payment Service Providers: Must allow account information service provider access to payment accounts.
  • Sweden’s Data Rights: Have not gone beyond PSD2.

Insurance Products

  • Regulated under the Insurance Distribution Act (IDA): Fintech companies selling or marketing insurance products in Sweden must comply with IDA regulations.
  • Marketing Exemptions: Marketing that is not covered by the scope of the IDA is characterized by the fact that it is not possible for a potential customer to take out an insurance in connection with the marketing measure.

Credit References

  • Regulated under the Credit Information Act: A license from the SAPP is required when carrying out credit-rating operations in Sweden.

These regulations aim to promote transparency, fairness, and consumer protection while allowing fintech companies to innovate and provide alternative finance solutions.