In 2017, with the level of maturity of the foreign exchange and CFDs trading industry, news of a new regulatory license jurisdiction license is relatively rare. Even when we do hear of a case of a new regulator welcoming a retail trading industry firm it is normally far outside of Europe, in some far offshore jurisdiction.
Having said all that, last week, ayondo made headlines with the acquisition of a brand new license from a brand new jurisdiction. The German regulator, one of the heavyweights of Europe, has granted the company a portfolio management license which enables the firm to expand its social trading offering. The company plans to use the licensed subsidiary to cater to client needs across the European Union.
Finance Magnates reached out to the ayonda’s CEO Robert Lempka with some questions on the company’s important milestone.
When did you decide to obtain a BaFin license? What were the key drivers for the decision?
We are constantly working to refine and improve our innovative social trading offering. We put customer experience and protection at the centre of our business activities, and the BaFin licence is a benefit to both our retail and B2B clients. Furthermore, transparency and a clear regulatory environment is a necessity as we focus on our international expansion. The licence represents a milestone within the European FinTech market and paves the way for future market developments.
How long did it take you to obtain the licence from the initial time of application?
It took approximately a year of working in collaboration with and according to the BaFin guidelines, and adopting traditional portfolio management to the needs of today and specifically, to the online world of Social Trading.
How complex would you rate the procedure of obtaining a license in Germany and what are the costs associated with it?
Alongside the UK FCA, the Monetary Authority of Singapore (MAS), the German regulator BaFin is one of the most respected regulatory authorities globally. It is a reliable partner in the area of policy formation, supporting the ongoing development of regulation. For ayondo, obtaining a license under recognized European supervisory standards was always a priority. We are certain that the benefits to us as a business and to our customers outweighs any challenges and costs.
Does the license include dealing as a principal or only as a matched principal?
The portfolio management license covers the provision of social trading services via our WeTrade platform. The mechanism of trade execution remains unchanged with execution occurring via ayondo markets Limited (UK), our FCA regulated entity.
Do you plan for a special marketing campaign to clients in Germany and how do you plan to market the license?
Following the announcement of the introduction of the license, we have already received very positive feedback from clients and industry partners. We will continue to use confirmation of the license within our communication, whilst our first priority remains our existing client base.