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FinTechs belonging to this category offer advisory and broking services for investments usually via an internet platform.
Robo advisory services usually offer an investment proposition following a series of questions concerning the personal financial background and the risk-bearing capacity of the user. Sometimes the respective platform also enables the user to directly execute the proposed investment.
Auto-trading concerns all services which automatically trade on behalf of the customer according to his or her specifications.
Apart from that some FinTechs collect and offer merely or as an ancillary service market information or operate comparison portals to increase the transparency of the capital markets and to help the investor with his decision-making.
There are also FinTech-advertising-services which advertise various financial services or products.
Introduction
Attitude of the country towards modern financial advisory and broking services
It could be said that financial advisory through FinTechs is being accepted as a real financing alternative, mainly because FinTechs companies offer more agile and less costly financial services through communication and information technologies. Proof for that is their annual growth of up to 15 per cent. Automated investment platforms, including robo advisory, have grown over the last two years.
Legal affairs
Obligations and requirements to provide financial advisory and broking services, or ancillary services described above
In Spain, financial advisory companies ('Empresas de Asesoramiento Financiero', 'EAFi') are regulated in the Spanish Securities Act (Ley del Mercado de Valores). Anyone, who provides investment advice, is subject to an authorisation requirement by the CNMV. Also, companies must comply with anti-money laundering and data protection regulations.
Among other requirements, the minimum capital of an EAFi is €75,000. It was €50,000 until 29 November 2023 which came into force Decree 813/2023 of 8 November which regulates financial advisory companies and transposed in the Spanish legal system Directive 2019/2034/CE. However, Decree 813/2023 creates a type of financial advisory company so called “Empresas de Asesoramiento Financiero Nacional” “EAFiN” which are not permitted to have funds or financial assets from their clients and can only provide services regarding advising on investments in Spain and not in other UE countries. The minimum capital required for these companies is €50,000, or is their capital is less they must take out an insurance with a minimum cover of €1,500,000.
The fact that advice is automated does not imply any difference regarding the regulation applied to services offering investment advice (technology neutrality principle). Such automated investment service must be provided in compliance with all applicable rules of conduct and, in particular, following the suitability assessment of its customers.
As of January 2025, EAFi and EAFiN are also subject to the Digital Operational Resilience Act (DORA), which imposes requirements on ICT risk management, incident reporting, and oversight of third-party technology providers.