The fintech sector has experienced an explosion of innovations, ranging from public blockchain solutions to private banking algorithms. As a consequence, intellectual property protection, particularly through patents, has taken center stage. The approach to patenting, however, can significantly differ based on whether the innovation is public-facing or confined to private use. This article dives deep into distinct patent filing strategies suitable for each type of fintech innovation.

Understanding the Landscape: Public vs. Private Innovations

Public Innovations in Fintech

These innovations are typically accessible and available to the general public. Examples include:

  • Blockchain & Cryptocurrencies: Distributed ledger technologies designed for transparency and decentralization.
  • Open Banking Platforms: Systems that allow third-party developers to build applications and services around a financial institution.

Private Innovations in Fintech

Private fintech solutions are typically proprietary, developed to enhance or streamline internal processes or offer exclusive services to clients. Examples include:

  • Algorithmic Trading Systems: Algorithms developed by investment banks for high-frequency trading.
  • Risk Management Algorithms: Solutions that analyze a plethora of data to assess and predict various financial risks.

Patent Filing Strategies for Public Innovations

Emphasizing the Unique Selling Proposition (USP)

Why It Matters:
Public innovations in fintech often attract a multitude of players, making the space crowded. The USP of an innovation can be a critical differentiator in patent applications.

Steps to Take:

  • Clearly define what sets the innovation apart. Is it a new consensus algorithm in blockchain? Or perhaps a unique data-sharing protocol in open banking?
  • Provide exhaustive documentation, including flowcharts, diagrams, and working prototypes if possible.

Prior Art Searches

Why It Matters:
Given the public nature of these innovations, there’s a high likelihood that some aspects might have been discussed, published, or patented already.

Steps to Take:

  • Utilize patent databases and fintech forums to ensure that the innovation or elements of it haven’t been disclosed publicly.
  • Consider hiring professional patent search firms specializing in fintech.

Preparing for Global Filings

Why It Matters:
Public fintech solutions often have a global user base, making it essential to secure patent protection across multiple jurisdictions.

Steps to Take:

  • Identify key markets for the innovation and understand their patent filing requirements.
  • Consider leveraging the Patent Cooperation Treaty (PCT) for simultaneous patent applications in multiple countries.

Patent Filing Strategies for Private Innovations

Assessing Patent vs. Trade Secret

Why It Matters:
For proprietary solutions, innovators face the decision of patenting their innovation (thereby disclosing it) or keeping it a trade secret.

Steps to Take:

  • Evaluate the lifespan of the innovation. If it’s short-lived, a trade secret might be more appropriate.
  • Consider the risks of reverse engineering. If competitors can easily decipher the innovation, patent protection may be the safer route.

Focused Patent Applications

Why It Matters:
Private innovations often address very specific problems, making their patent applications narrower and more focused.

Steps to Take:

  • Define the core of the innovation. Is it a new algorithmic formula? Or a unique data processing technique?
  • Tailor the patent application to cover this core, providing comprehensive details and preempting potential questions from patent examiners.

Confidentiality and Non-disclosure Agreements

Why It Matters:
During the patenting process, there might be interactions with external entities, be it patent attorneys, consultants, or potential partners.

Steps to Take:

  • Draft robust confidentiality agreements to protect the details of the innovation.
  • Limit the exposure of the innovation’s intricacies until patent protection is secured.

Collaborative and Licensing Aspects

Navigating the fintech patent landscape isn’t just about securing rights. It’s also about collaboration and possible licensing of innovations. These facets play out differently for public and private fintech solutions.

Public Innovations: Collaborative Ventures and Open Licensing

Embracing Open Innovation

Why It Matters:
Given the community-driven ethos of many public fintech solutions, especially in blockchain, embracing an open innovation model can be advantageous.

Steps to Take:

  • Consider establishing collaborative frameworks with other innovators in the space. This can expedite technology development and adoption.
  • Explore partnerships with academic institutions or think tanks to further refine and test the innovation.

Licensing with Flexibility

Why It Matters:
Given the vast user base and the myriad applications of public fintech solutions, flexible licensing can encourage adoption and integration.

Steps to Take:

  • Opt for licensing terms that allow third-party developers or institutions to incorporate the innovation into their platforms, possibly with certain conditions.
  • Consider tiered licensing, where basic usage is more accessible, but advanced features or scalability options come at a premium.

Private Innovations: Strategic Alliances and Exclusive Licensing

Forming Strategic Alliances

Why It Matters:
Private innovations often cater to niche segments, and forming alliances can help in accessing these segments more effectively.

Steps to Take:

  • Identify potential partners that can benefit from the innovation. This might include other fintech firms, financial institutions, or even non-fintech enterprises.
  • Engage in pilot projects or proof-of-concept trials to showcase the innovation’s potential and iron out integration challenges.

Opting for Exclusive Licensing

Why It Matters:
To maintain the competitive edge that private innovations offer, exclusive licensing can prevent widespread dissemination.

Steps to Take:

  • Clearly delineate the terms of exclusivity in licensing agreements. This might relate to geographic regions, duration, or specific application areas.
  • Regularly review licensing agreements to ensure that they align with the evolving business strategy and market conditions.

Navigating Regulatory Complexities

The fintech domain, given its intersection with finance and technology, is often riddled with regulatory intricacies. These considerations play a pivotal role in patent strategies.

Public Innovations: Staying Ahead of Regulatory Changes

Why It Matters:
Public fintech solutions often operate in gray regulatory zones, especially when considering global applications like cryptocurrencies.

Steps to Take:

  • Maintain an active channel of communication with legal experts specializing in fintech regulations.
  • Periodically review patent strategies to ensure compliance with evolving regulations, especially if the innovation is being expanded to new markets.

Private Innovations: Ensuring Data Privacy and Security

Why It Matters:
Many private fintech solutions deal with sensitive financial data, making them subject to stringent data protection regulations.

Steps to Take:

  • Ensure that the innovation adheres to data protection standards, such as GDPR in Europe or CCPA in California.
  • In the patent application, highlight the measures taken to ensure data privacy and security, as this can enhance the patent’s credibility and potential value.

The Role of IP Consultation and Expertise

Given the nuanced nature of fintech innovations and the intersection of finance, technology, and law, engaging with intellectual property (IP) experts can be invaluable.

For Public Innovations: Engaging with IP Strategists

Why It Matters:
Public fintech innovations are often at the frontier of technology, making it challenging to gauge their patent potential and enforceability.

Steps to Take:

  • Collaborate with IP strategists who can offer insights into the long-term viability and potential market value of the patent.
  • Consider proactively monitoring IP landscapes to identify potential infringers and enforce patent rights if necessary.

Why It Matters:
The proprietary nature of private fintech solutions necessitates a comprehensive understanding of IP laws, especially when considering global expansion.

Steps to Take:

  • Establish a continuous dialogue with patent attorneys to ensure that the patent application remains robust against potential rejections or challenges.
  • Use patent counsels’ expertise not just for filing but also for IP audits, ensuring that all proprietary solutions are adequately protected.

Continuous Review and Re-strategizing

The fintech realm, given its dynamic nature, mandates regular reviews of patent strategies to adapt to technological advancements and market shifts.

For Public Innovations: Embrace Adaptability

Why It Matters:
With rapid technology evolution, especially in areas like blockchain, staying rigid can render a patent strategy obsolete.

Steps to Take:

  • Keep track of technological advancements and shifts within the community or industry. Adapt patent strategies accordingly.
  • Engage with community forums, attend fintech conferences, and stay updated with journals to ensure the patent portfolio remains relevant.

For Private Innovations: Safeguarding Competitive Edge

Why It Matters:
The value proposition of many private fintech innovations lies in the competitive advantage they offer. It’s vital to ensure this edge isn’t eroded over time.

Steps to Take:

  • Regularly assess the market landscape to identify emerging competitors and their patent portfolios. This can help in preempting potential IP conflicts.
  • Consider diversifying the patent portfolio, covering not just core technologies but also auxiliary innovations that enhance the primary solution.


Patent strategies in the fintech realm are multifaceted, shaped by the nature of the innovation—public or private—as well as the broader technological and regulatory landscape. Whether it’s a groundbreaking public blockchain solution or a proprietary risk assessment algorithm, understanding the nuances of each domain and crafting a tailored patent approach can spell the difference between IP success and missed opportunities.

In this rapidly evolving sector, staying proactive, seeking expert guidance, and being adaptable can ensure that innovations are not just protected but also leveraged for maximum impact.