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Legacy banking in Europe colludes to deny access to financial technology (fintech) companies, bitcoin-related and others, in an effort to retard growth, the European Commission alleges.Â
Also read:Â England Can Now Use Left-Over Change to Automatically Buy Bitcoin
Europeâs Envious Problem
Seemingly overnight, fintech companies, and those related, swooped and drained billions from a lucrative lending market previously thought to be institutionally locked down.
Companies such as Amazon.com Inc., PayPal Holdings, Square Inc., better put perhaps, catered to an underserved market : smaller merchants denied by notoriously stuffy banks on the continent. These unconventional lenders found an opening that trusted institutions could not be bothered with.
âWe give [smaller merchants] access to capital when others donât,â Amazonâs Vice President, Peeyush Nahar, pointed out. More agile, less-traditional and less politically-connected companies âget [a smaller merchantâs] business model when maybe others donât.â
Reutersâ Foo Yun Chee explains, â[European fintech] companies range from those offering mobile payment apps to digital currencies such as bitcoin.â
In no country is that more apparent than in the United Kingdom, where bitcoin and bitcoin-associated businesses have flourished of late â including payment services, exchanges, mining pools, and start-ups. Retailers accepting bitcoin in the UK are everywhere.
This is problematic for the European Union (EU), as Mr. Chee notes, âBritainâs withdrawal from the EU has added urgency to [dealing with such competition] because more than 80 percent of [the European Unionâs] fintech market is based in Britain.â
Commission Moves to Jump-Start Competition
EU âantitrust authorities are probing whether the banking industry is preventing rival services from accessing customersâ accounts,â Bloomberg News reports.
The EUâs principal in such matters is the European Commission.
In an online fact sheet, the Commission stated it âhas concerns that the companies involved and/or the associations representing them may have engaged in anti-competitive practices in breach of EU antitrust rules.â
At the time of writing, âthe companiesâ were not named, but Dutch and Polish banking institutions have confirmed being investigated.
Though still only allegations, the Commission goes on, âanti-competitive practices are aimed at excluding non-bank owned providers of financial services by preventing them from gaining access to bank customersâ account data, despite the fact that the respective customers have given their consent to such accessâ in violation of several statutes.
News.Bitcoin.com searched Dutch Banking Association (NVB) and Polish Banking Association (ZPG) websites for their respective positions on bitcoin. NVB yielded zero public statements, while ZPGâs lone mention is from 2013. Clearly, at least these legacy institutions were/are not ready for what bitcoin and bitcoin-related businesses might mean to their futures.
The Dutch Payments Association published a terse statement, acknowledging being under investigation and how it âwill of course fully cooperate with [The Commission] and is confident in the outcome of the investigation.â
Using a familiar line of excuse, ZPGâs Krzysztof Pietraszkiewicz told Bloomberg that giving âaccess to clientsâ credentials to third parties requires diligence and we wonât accept any shortcut solutions that would harm the safety of their deposits. For us security is a priority.â
However it all shakes out, bitcoiners are sure to keep fueling a new day for finance around the world.
What do you think? Is a government agency able to enforce competition, or does it just end up picking winners and losers? Does bitcoin even care? Tell us in the comments below!Â
Images courtesy of: RTE, Fleur de Coin, Digital Trends.
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The post Fueled by Bitcoin, Fintech Booms in Europe as its Banking Cartels Aim to Slow Pace appeared first on Bitcoin News.
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