Part III Financing Innovation, Start-Ups, Non-Listed Companies, and Infrastructure Projects, 8 The Role of Financial Innovation in EU Market Integration and the Capital Markets Union: A Reconceptualization of Policy Objectives
Edited By: Danny Busch, Emilios Avgouleas, Guido Ferrarini
- Capital markets
This chapter offers a critical overview of the issues that the European Union 27 (EU-27) will face in the context of making proper use of financial innovation to further market integration and risk sharing in the internal financial market, both key objectives of the drive to build a Capital Markets Union. Among these is the paradigm shift signalled by a technological revolution in the realm of finance and payments, which combines advanced data analytics and cloud computing (so-called FinTech). The chapter begins with a critical analysis of financial innovation and FinTech. It then traces the EU market integration efforts and explains the restrictive path of recent developments. It considers FinTech's potential to aid EU market integration and debates the merits of regulation dealing with financial innovation in the context of building a capital markets union in EU-27.