Regulate To Accumulate
Origin CEO, Raja Palaniappan, is a big believer in collaboration and cooperation and that philosophy doesn't waver when it comes to regulation. As Raja wrote last week:
It’s vital that fintech never considers itself outside of the regulatory framework. Great businesses and business models are being set up everyday that are exciting and fresh, but they must be willing to comply with regulatory norms. Working with regulators breeds long term success, industry-wide. Working against them brings industry-wide risks.
Our sector needs to recognise that financial service providers sit under the guidance of a regulator, who is there to look out for the interests of consumers, even if the existing letter of the law doesn’t, as yet, take them into account or provide any rules.
Strong fintech companies build models that accommodate that reality and work to improve as and when the regulator updates the framework. The weak – those that don’t last – will enjoy flash-in-the-pan growth before burning out when a downturn hits, defenceless and siloed because they refused to cooperate and embrace regulation.
This is a really good point and a really strong conclusion to Raja's weekly piece. "Building models that accommodate..." should be a guiding principle for any company looking to grow, working with and alongside large incumbent players and authorities.
It's a principle that Origin follows better than many companies we've met, despite working in the capital markets where the same behemoths have dominated the landscape for decades and regulation is, understandably and correctly, getting ever more stringent and invasive.
Collaborate, cooperate, regulate... do whatever you have to do to accumulate, and that means accumulating as a sector, not just as a business. Raja and his team's example is one that any ambitious fintech business would be wise to follow.