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Fintech Market Overview

This article does not constitute legal advice.

Payment services in the USA

Fintech Software

In the USA, virtual trading platforms are released from the regulations related to fintech organizations. The majority of these trading facilities are subject to regulation depending on their products and services. For instance, Uber and Lyft should comply with the laws related to taxis in the American system of justice.1

These e-commerce sites are exempt from fintech related laws as of the funds for product purchases are processed by the appropriate payments agencies. For instance, you pay for e-Bay goods using your PayPal wallet. Also, these trading platforms accept payments, but they are not obliged to follow fintech rules, like “agent of the payee”. These virtual market platforms support credit card paying method which does not need obtaining fintech licences.1

Payment service providers are subject to strong regulation in the United States. These agencies should pass registration serving the role of money services businesses with FinCEN to get state money transmitter licences. Although some companies specializing in financial technology falsely assume that their registration as MSB with FinCEN is enough to perform as a payment service provider across the US. There is none of that, because money transmitter licenses should be obtained according to state laws.1

Payment service providers are obliged to possess a licence for their business activities in each state. The US jurisdiction differs from European jurisdiction in this area because of the absence of a reciprocity or passport option. This means that Americans do not require having valid money transmission licensing for operation across the country, which is a rather toxic, expensive, and time-consuming procedure.1

There is no law similar to the EU Revised Payment Services Directive in the United States that demands financial companies pass their clients' information to fintech organizations.1

In accordance with Section 1033 of the Dodd-Frank Act, financial entities should guarantee the availability of their clients' financial information. In other words, this information should be delivered in a convenient way, defined as “usable form,” although there is no specific regulation that imposes penalties for non-compliance.1

Cryptocurrencies in the USA

Fintech in the USA

Fintech in other countries

Let's introduce you

US Fintech Lawyers

Roman Buzko

Roman Buzko

Registration, regulatory advice, investment transactions and dispute resolution.

Silvia Calls

Silvia Calls

We work for international SMEs, startups and Telco's

Viacheslav Losev

Viacheslav Losev

Legal support for FinTech and Blockchain projects

Fintech investors from the USA

2048 Ventures

2048 Ventures

We are a team of experienced operators and dreamers who are passionate about working with founders at the earliest stage

First Check Ventures

First Check Ventures

Our syndicate is focused on investing in early stage startups across the globe

Notes
  1. https://thelawreviews.co.uk/title/the-financial-technology-law-review/usa
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