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UPDATE: EU sets out plan for fintech development, digital single market

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UPDATE: EU sets out plan for fintech development, digital single market

The EU will create a financial technology laboratory to promote investment in the sector as part of its plans to build a capital markets union and a digital single market, the European Commission said.

The EU's executive arm said the laboratory would enable European and national authorities to work with tech companies as part of the EU's fintech action plan, which will encourage the financial services industry to use blockchain, artificial intelligence and cloud services. The EC said its existing Blockchain Observatory and Forum would report later in 2018 on "the challenges and opportunities of cryptocurrency assets;" it is working on a comprehensive pan-European strategy on distributed ledger technology and blockchain.

The EC will also look at how information on listed companies could be exchanged across borders by interconnecting national databases to make it easier for investors to make decisions. It wants to create a single market for consumer financial services.

It will run workshops on cybersecurity and will present a blueprint on regulatory sandboxes, which are frameworks set up by regulators allowing fintechs to conduct live experiments in a controlled environment under regulatory supervision. The EC will also set out rules for crowdfunding and is proposing an EU license that would allow crowdfunding platforms to operate across the EU and start-ups to raise financing across the bloc.

"This would help them to scale up and offer choice for investors and more opportunities for entrepreneurs to attract funding across the EU," Valdis Dombrovskis, the EU commissioner for financial stability, financial services and the capital markets union, told a news conference in Brussels.

The European Banking Federation said in a statement that the EU needed to "move away from the current patchwork of different regulatory approaches" across the bloc to compete in fintech. EBF CEO Wim Mijs said the Commission had to "serve as a catalyst" to create a cross-border fintech sector and single digital market.