FinTech in Russia

FinTech is rapidly changing our lives and entering into competition with traditional institutions such as banks and distributors of financial services. It becomes now easy to make a non-cash payment from a buyer to a seller, get instantly a loan at a favorable rate, invest capital successfully – and all this, bypassing a bank.

The specifics of the digitalization process in Russia is in that not venture funds and investment companies but traditional banks are at the head of infrastructure projects, they finance FinTech-startups and create platforms for testing of innovative solutions. Among the most active are members of the FinTech Association are Sberbank, VTB, Alfa-bank. Prospects of new technologies encourage the banking sector to modernize business processes, improve internal information systems, enhance the quality of data analysis.

The following areas are covered by FinTech in Russia:

services for assets management
loyalty – special tools for managing of customer loyalty
PFM (Personal Finance Management)
online accounting – services for automatization of the reporting process
crowdfunding and crowd investing
marketplace – aggregators of information on products and services of different producers and providers
neo-banking – banks without branches, operating online technology platforms
infrastructure solutions – services designed to automate particularly the following processes: data processing, credit ratings and scores calculation, information security.

FinTech globally has crossed the boundaries of technologies for finance sector. There is a refocusing to consumers and now any technological innovations may be attributed to FinTech: blockchain, biotechnologies, artificial intelligence, Big Data technologies, machine learning and application programming interfaces (API).

The API technology is successfully used by users of The Information and Analytical system Globas https://globas.credinform.ru/en-GB/home/auth* enabling to integrate Russian company data in internal corporate risk management systems.

Today two big tasks are facing Russia and the regulator: to create an infrastructure for universal access to financial technologies and ensure legal regulation. The lack of regulatory framework gives rise to incomparably different degree of responsibility and conditions for Fintech and traditional market players as well as cause violation of consumers rights, increase risks of their financial losses and involvement in operations on legalization of illegally received funds due to anonymity of transactions.

It is planned to develop and adopt regulatory basis by 2020 as part of the implementation of the «Digital economy of the Russian Federation» program. That will ensure a successful development of the Fintech sector in Russia. Until the end of 2019 a number of laws are to be adopted and brought into effect particularly with regard to the procedure for conducting of digital transactions, laws on digital financial assets, crowdfunding and digital rights.

* Solution of Credinform – a Russian provider of business credit reports – enables risk assessments of existing and potential buyers & suppliers in Russia; customers get information on solvency and credit limits, gain insight into financial accounts, ownership structure and business linkages, commercial background of CEOs/shareholders, litigation check and data on public procurements. About 20 credible sources are being constantly processed and monitored. Fresh investigations on Russian companies are also performed.