Financial Crime World

Swedish Fintech Regulations: What You Need to Know

The Swedish Financial Supervisory Authority (SFSA) has introduced new regulations to ensure that fintech companies operating in Sweden comply with strict guidelines, aiming to protect consumers and maintain financial stability.

Credit Agreements

  • The maximum amount of fees under a credit agreement may not exceed the credit amount.
    • Fees are defined as costs for the credit, including interest rates, credit fees, and other costs that the consumer is obliged to pay.
    • Default interest and collection costs are also included in the definition of fees.

Marketing of Consumer Credits

  • Marketing of consumer credits must be moderate, objective, and not misleading.
  • Fintech companies must clearly disclose the terms and conditions of the credit agreement.
  • The SFSA has imposed stricter regulations on marketing practices, including prohibitions on using certain language or making false claims.

Payment Services

  • Payment services are regulated under the Second Payment Services Directive (PSD2).
  • The Swedish Payment Services Act (PSA) requires account servicing payment service providers to allow account information service provider access to a payment account.
  • Fintech companies operating in Sweden must comply with these regulations and ensure that their services are secure, efficient, and customer-friendly.

Insurance Products

  • Fintech companies selling or marketing insurance products in Sweden must be regulated under the Insurance Distribution Act (IDA).
  • The IDA regulates insurance distribution and requires fintech companies to provide clear information to customers about the insurance product.
  • Fintech companies must also ensure that their sales practices are fair, transparent, and customer-centric.

Credit References

  • Credit references and credit information services are regulated under the Credit Information Act (1973:1173) and the Credit Information Regulation (1981:955).
  • A licence from the Swedish Agency for Public Management (SAPP) is required when carrying out credit-rating operations in Sweden.
  • Fintech companies must ensure that their credit reference services are accurate, reliable, and comply with data protection regulations.

Crowdfunding

  • The EU’s Crowdfunding Regulation establishes a harmonized framework for crowdfunding service providers across the European Union.
  • In Sweden, crowdfunding is regulated under the Companies Act (2005:551), which prohibits Swedish private companies or shareholders from attempting to sell shares or subscription rights in the company or debentures or warrants issued by the company to the public.

Invoice Trading

  • Invoice trading is regulated under the Credit Information Act (1973:1173) and the Credit Information Regulation (1981:955).
  • Fintech companies participating in invoice trading must register their operations with the SFSA and comply with anti-money laundering regulations.

In summary, these are some of the key regulations that fintech companies operating in Sweden must comply with. The SFSA continues to monitor the fintech industry and may introduce new regulations or stricter guidelines as needed to ensure financial stability and consumer protection.