The entry of innovative operators into the Italian banking landscape is growingalthough this still has a limited impact on the market structure. However, an increase in potential new entrants will also result from regulatory developments, which have regulated new business sectors by reserving them to authorized intermediaries. This is what emerges from a report that describes the authorization activity carried out by the Bank of Italy in the last three years, but which also looks at the trends and innovative models of the sector.
Before moving on to the analysis of the numbers, it is important to underline that the establishment of new services and operating models has usually coincided with the entry of new entities into the market; “although in many cases existing intermediaries can also carry out the new activities subject to dedicated regulation, it is frequent to set up specialized entities, often small in size, with flexible cost structures, also thanks to the frequent use of outsourcing and partnership agreements”, as stated in the report.
The banks
Only 2 new banks were authorised in the period considered: one project was based on the need of the promoting group to expand its business, positioning itself in the Italian banking sector through the purchase of a branch of the company and thus expanding the offer to its customers with a range of diversified products and services; the other, highly innovative, led to the creation of a Italian fintech bankwhich offers its services to customers only through digital channels, without the use of branches or other physical structures.
Non-bank intermediaries
The non-banking sector continued to show high dynamism. The number of authorizations issued is high, in particular, in the managed savings sector. In the three-year period 2021-2023, 21 asset management companies entered the market (SGR) and 27 fixed capital investment companies (SICAF). The role of private capital in supporting the development of the real economy has also been supported by initiatives by national and European legislators, which have expanded the range of tools available to operators.
“The authorised initiatives mainly concern the sectors of venture capital he was born inprivate equity and respond to the need of promoters to enhance the experience acquired in the same fields to expand their operations and raise funds from other investors as well”, the report states.
In the segment of the non-bank credit In the last three years, 8 financial intermediaries have been authorised pursuant to art. 106 of the TUB, all part of corporate groups already supervised or of industrial origin.
There have also been numerous initiatives in the Payments sector (16 payment institutions and electronic money institutions), almost all characterised by significant technological content.
Opinions have also been issued to Consob as part of the SIM authorisation process, mainly for the exercise of trading activities on own account, execution of orders on behalf of clients and investment consultancy. More than half of the initiatives are part of the repositioning process of UK operators following the Brexit.
In 2023, the first specialized providers offering services were authorized crowdfunding to businesses.
The foreign intermediaries have continued to show significant interest in the Italian market. The Bank of Italy has received a total of 293 notifications from the Authorities of the countries of origin to allow EU intermediaries to operate in Italy with establishment and/or in the free provision of services.
Innovative operators
In the vast majority of cases, the authorised innovative operators are Payment institutions. In the three-year period 2021-2023, 11 payment institutions were authorised. With one exception, all of them were authorised to provide the account information service (AIS) and/or payment initiation service (PIS) services introduced by PSD2.
New payment service providers (also called third-party providersTPP) access via APIs the data of payment accounts that customers hold with other intermediaries, in order to offer primarily to the customers themselves information services (AIS) and – more rarely – device services (PIS). A further innovation observed in the payments sector is the entry into the market of IPs that operate as payment facilitators (sometimes PayFac for short), interposing themselves between large acquirers – active internationally in accepting payments – and the merchants to be affiliated.
Among the significant developments, also due to the entry of foreign operators into the domestic market, it is worth highlighting the growing diffusion of the so-called. banking-as-a-service (BaaS). This is a new way of providing banking and financial services based on the collaboration between a supervised intermediary and a partner company, which may itself be a supervised entity or a non-financial company (e.g. industrial, commercial, fintech companies not authorized to provide financial services). The partner company (e.g. e-commerce platform) distributes to its customers the financial service offered by an authorized intermediary (e.g. consumer credit offered by a bank) and manages the relationship with the end customer, without having to request its own authorization to carry out reserved activities.
The entry of foreign fintechs
Among the trends that affect the Italian market and modify the competitive scenarios, Bankitalia records the interest of leading fintech companies in the European Union to expand their presence in our country. In the last three years, at least five highly innovative foreign operators – four banks and one electronic money institution – have notified their intention to establish branches in Italy, where some of them were already active under the freedom to provide services regime. From the dialogue with the operators, the various reasons for these choices emerged, united by the intention to increase the customer base in Italy more rapidly.
In most cases, the proposed service models are placed in growing market segments (e.g. buy now pay later; digital light banks that mainly target retail customers and SMEs; banking as a service providers).
