Neo-conglomerates and EU regulatory perimeter challenges – state of play and evaluation of policy options

This paper examines the implications of the provision, in the European Union, of bank-like services, including payment services, by large non‑bank groups (i.e. groups that do not comprise entities with a banking licence), and evaluates policy options to address the emergence of so-called neo-conglomerates by recalibrating the regulatory perimeter. Drawing on five EU case studies (a messaging app white‑label arrangement, a complex multi‑partner “super‑app” model, a systemic payment group, a borderless financial technology firm (fintech) and a bank) – this paper illustrates how financial services may be delivered through digital unbundling and re-bundling, embedded distribution and white‑label partnerships. It maps the business models, licensing structures, fintech partnership chains and data frictions that may obscure group‑wide risks and complicate home‑host supervisory cooperation. The cases were included for illustrative purposes only, and implying no judgement at all on the soundness or governance of the firms concerned, nor on the effectiveness or adequacy of the actions taken by the relevant supervisory authorities. The paper also identifies potential “blind spots” in the regulatory frameworks applicable at the time of writing and misalignments in prudential, conduct and operational objectives. Building on guidance from standard‑setting bodies and international organisations on supervisory approaches to financial innovation, fintech and Big Tech, the paper identifies four priority areas for consideration, with a view to limit regulatory arbitrage and systemic interdependencies, while at the same time preserving innovation. [...] JEL Classification: G28, E58, K23, O33, F36, G32