Spain: CNMC speaks out in support of “Fintech” adoption

The breakout of Fintech in the financial sector boosts competition, which will generate greater efficiency in terms of more affordable prices, as well as better and more differentiated services and a transparent pricing structure, according to a report prepared by Spain’s National Commission for Markets and Competition (CNMC).

The Spanish regulator considers new entrants and “niche” competitors (whether newly created companies or established ones from different sectors) can vie for the positions held by established operators, reducing costs, prices, and profit margins and expanding choice and dynamic innovation.

However, the existence of other barriers such as economies of scale or access to data, which may lead Fintech to assume the role of “secondary entities or banks,” stands out. “Many of the new competitors will not be able to apply cross-subsidies and carry out economies of scale, so they will be forced to constantly offer more advantageous conditions and, therefore, obtain a better profitability.”