Financial Crime World

Swedish Financial Regulations Toughen Up

In an effort to protect consumers and promote financial stability, Swedish authorities have introduced stricter regulations for various financial products and services. These changes aim to ensure that market participants operate in a fair and transparent manner.

Consumer Credits

The marketing of consumer credits is now subject to more stringent moderation requirements. Authorities will assess whether credit advertisements are presented in a way that misleads consumers or pressures them into making an unfounded decision. Marketing materials must be:

  • Neutral
  • Factual
  • Balanced, with no disproportionate highlighting of certain terms

Additionally, payment service providers are prohibited from:

  • Presenting credit purchases as the first option
  • Setting them as the default payment method for online transactions where other payment methods are available

Crowdfunding

The EU’s Crowdfunding Regulation will apply in Sweden from November 2021. This regulation establishes a harmonized framework for crowdfunding service providers across the European Union.

Invoice Trading

Companies involved in invoice trading, such as acquiring claims, must:

  • Register their operations with the Swedish Financial Supervisory Authority (Finansinspektionen)
  • Comply with anti-money laundering regulations

Payment Services

Sweden’s Payment Services Act regulates payment services, including:

  • Money remittance
  • Execution of payment transactions
  • Acquisition of payment instruments
  • Payment initiation
  • Account information services

Insurance Products

Fintech companies selling or marketing insurance products in Sweden must comply with the Insurance Distribution Act. This regulation covers:

  • Insurance distribution, including marketing and sales activities that involve taking out an insurance policy

Credit References

A licence from the Swedish Consumer Agency (Konsumentverket) is required for credit-rating operations in Sweden. These regulations aim to ensure that credit information services operate fairly and transparently.

Conclusion

These changes reflect the Swedish authorities’ commitment to promoting financial stability, protecting consumers, and fostering a healthy financial ecosystem. As of July 10, 2020, these regulations are in effect, providing a robust framework for market participants operating in Sweden.