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FinTechs - Managing Finance and Risk

Challenges

Young companies focus on the development of sustainable business models. A short time-to-market is an essential part of fintechs’ DNA. At the same time, specific legal and regulatory requirements must be implemented and complied with at short notice. Due to the focused business model and a small organizational structure, many of the requirements can be implemented through pragmatic solutions. Nevertheless, young institutions face considerable challenges in the medium term, especially in corporate management, in order to meet the increasing regulatory requirements. This concerns finance, risk, controlling, treasury and regulatory reporting.

Finance

This is about accounting. The focus is on correct data in particular, as well as on the introduction of relevant software, corresponding processes for financial reporting, and capital planning.

Controlling

The focus is on setting up appropriate reporting structures and relevant key figures. In addition, there is the establishment of control logic, e.g. across products and business areas.

Reporting

The development of appropriate reporting structures for supervision, the identification of relevant data and the implementation of supervisory calculation logic are required here.

Risk

The focus is on risk-bearing capacity, risk-management processes and reporting, but also on the development of relevant risk models or the parameterization and validation of risk parameters.

Treasury

The main topics here are liquidity management, funding planning, interest book management, and asset & liability management.

Insights

Fintechs that disregard corporate management or grow very rapidly run the risk of both violating regulatory requirements and making the wrong management decisions. Despite initially pragmatic solutions, they can no longer comply, over the long term, with fundamental issues such as risk-bearing-capacity requirements, compliance with regulatory capital and liquidity requirements, or even sustain well-functioning processes. This can lead to misunderstandings in discussions with controllers or investors and cost time and resources in making the necessary corrections.

Solutions

In supporting young institutions, we draw on our many years of expertise in consulting in the management environment.
We have the appropriate solutions and blueprints to implement supervisory requirements in an appropriate manner, taking into account the principle of proportionality. We are familiar with the expectations of institutions during on-site inspections by the supervisory authorities and support them in eliminating deficiencies, from the technical concept to implementation.

Learn more from one of our specialists

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Dirk Queisner
Senior Manager