The Ontario Securities Commission (OSC) is launching an innovation hub to work with fintech startups, helping them navigate the regulatory framework and giving them a say in how rules should be shaped for new business models.
In a speech, OSC chair Maureen Jensen says that some of the new fintech businesses and platforms that have emerged in recent years don't fit neatly into existing rules for FS firms.
"We recognize that we have to keep pace with the changes brought on by fintech and not prevent promising business models from coming to market," she says.
The watchdog has already worked with some 40 firms in areas such as P2P lending and crowdfunding over the last couple of years, guiding them through the registration process.
Many of them "don’t know what they don’t know" about operating in a regulated industry, says Jensen, and that can threaten their ability to launch their business model.
To help tackle this problem, the new OSC LaunchPad will house a dedicated team to work directly with fintech firms as they navigate the regulatory landscape.
Not only this, "we will work to tailor regulation and oversight to their unique business models, as long as investor protections are in place," says Jensen, adding that startups should get in touch early, "even in the idea phase".