Douglas Arner, Janos Barberis, Ross Buckley
SSRN Legal Scholarship Network
October 2015
Abstract: "Financial technology" or "FinTech" refers to technology enabled financial solutions. FinTech is often seen today as the new marriage of financial services and information technology. However, the interlinkage of finance and technology has a long history and has evolved over three distinct eras. FinTech 1.0, from 1866 to 1987, was the first period of financial globalization supported by technological infrastructure such as transatlantic transmission cables. This was followed by FinTech 2.0, from 1987 to 2008, during which financial services firms increasingly digitized their processes. Since 2008 a new era of FinTech has emerged in both the developed and developing world. This era is defined not by the financial products or services delivered but by who delivers them. This latest evolution of FinTech, led by start-ups, poses challenges for regulators and market participants alike, particularly in balancing the potential benefits of innovation with the possible risks of new approaches. Click here to download the full paper. For related posts on FinTech, click here. This paper and other work by Arner and Barberis were cited extensively in the Our Hong Kong Foundation's policy paper, "The Ecosystem of Innovation and Technology in Hong Kong" (December 2015).
A valuable background read on the evolution of FinTech as well as insightful thoughts on the divergence between "Fintech 3.0" in US/Europe vs "FinTech 3.5" in Asia.
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