Fintech and the limits of financial regulation: A systemic perspective

Abstract

This chapter explores the analytical lens beyond the common preoccupation with the piecemeal revision of specific legal rules that do not map neatly onto fintech developments. It argues that fintech is a fundamentally systemic regulatory challenge, a macro-level force disrupting the currently dominant technocratic paradigm of modern financial regulation. The chapter discusses the inherent inability of the existing technocratic regulatory model to accommodate these systemic changes and outlines the core changes in the underlying philosophy of financial regulation necessary in order to meet the fintech challenge. A sustained inquiry into the systemic meaning and impact of fintech as a regulatory phenomenon must start with an analysis of the defining features of the current system of financial regulation. Fintech is fundamentally changing the way financial services are delivered and transactions are conducted. Fintech innovations are also broadening the menu of financial services and products.