Integrating Europe’s business communities
Commentary by Cora van Nieuwenhuizen MEP, Member, Economic and Monetary Affairs Committee, European Parliament, ALDE
The EU Capital Markets Union (CMU) aims to create a deeper and wider single capital market in Europe, rather than the 28 fragmented markets we have today. Since the previous edition of 1000 Companies to Inspire Europe, we in the European Parliament have passed a number of significant issues that will help further integration, and in turn hopefully facilitate growth in the real economy.
When it comes to innovation, the financial industry has a real challenge ahead. Especially where banks are concerned, we are still talking too much about the consequences of the crisis and the threats that may still face us. However, we should focus instead on the innovative future of banks and financial institutions. This will also be of enormous influence on SMEs and consumers and the way these can organise their finances in the future.
Things are developing fast. Worldwide investment in fintech in 2015 was $19bn, up from $1.5bn five years earlier. Brussels, but also the EU financial centres and governments in London, Frankfurt, Amsterdam and elsewhere, need to keep up with this.
One conclusion that we have drawn from this in the European Parliament, in our report on what the EU CMU can do for fintech, is that regulation needs to facilitate innovation rather then frustrate it. Creative newcomers need more space. And they need fewer hurdles, but also room for experimenting.
Fintech will specifically create new business models within one of the most heavily regulated and complex industries: finance. But in addition, it is important to realise that it will also offer startups and SMEs more possibilities to finance their projects and companies. It is important that this potential is unleashed, in close conjunction with the development of all other channels of capital on the startup funding ladder.
But to close the circle, these new fintech innovators themselves will also need to be funded. That is yet another reason that the report you are currently reading is so important.
1000 Companies to Inspire Europe continues to be an important reflection of the creativity of European entrepreneurs, something incredibly important, which we politicians must continue to nurture and support. As MEPs, we will do our best to ensure the right environment for them to thrive and support all of Europe in its economic recovery.