For Fintech’s Sake, Don’t Build a Digital Wall
This week’s cliffhanger election has conjured a whirlwind of polarized emotions, as Americans launched into either panic or celebration. The president-elect’s policies will undoubtedly affect many industries, and the connected world as we know it, including one of my personal favorites – fintech. American Banker has identified the crux issue of impending change: net neutrality.
Net neutrality is the principle that Internet service providers should enable access to all content and applications regardless of the source, and without favoring or blocking particular products or websites. Donald Trump does not support net neutrality, which in today’s world is a paramount driver of innovation and shared knowledge in the tech space.
Putting politics aside, what would an anti-net-neutrality world possibly entail for fintech? To start, fintech is a global industry. As American Banker’s John Adams explains, “In addition to open source, much of the current innovation in payments is geared toward cross-border transactions, using blockchain and cloud technology to ease execution and erase artificial borders. The idea that there may be even a digital wall built around the U.S. could further chill the market.”
Fintech firms, among other businesses, rely heavily on open-source and other technology toolkits to quickly and easily develop programs that from scratch would have taken far more time, money and manpower to bring to fruition. Without an open Internet policy consumers wouldn’t have access to some of the most essential tools in their smartphones – can you imagine a world without Uber? I think I just died a little inside.
Just a few weeks ago, I was writing about how the IoT is changing the world. Well, in order for the IoT to have an effect, developers need to have access to open source information that allows them to build the innovative platforms that are connecting our devices. If we do away with net neutrality, the world will not come to an end, but the development speed of new technology will decrease – and as a millennial, that’s definitely a reason to panic.
Additionally, a so called digital wall could raise barriers to technology firms looking to bring to their business to the U.S. Without a nurturing landscape for fintech firms, and startups in particular, the U.S. could lose out on some of the world’s leading innovations.
Changing Internet laws now could significantly alter how financial technology is conceived, built and delivered to market. Walking back on net neutrality could increase hosting costs, resulting in fewer open-source options and centralizing innovation around larger companies that can afford the extra fees.
In a time where open source and collaboration have driven some of the most ground breaking advances of our time in the technology sector, potentially closing theoretical borders feels like taking a step backward. As the fintech industry continues to grow, the U.S. will need to provide desirable regulation and support for firms in the space or potentially risk losing top talent to other countries.