Changes in financial regulation introduced in the light of the financial and banking crises of the past decade, in conjunction with rapid progress in fields such as blockchain and artificial intelligence, are creating shifts in the relationship between technology and the banking industry. Financial technology companies are capitalising on the regulatory challenges banks face, especially when it comes to servicing smaller customers, as well as in relation to their biggest asset – data – which is helping them offer a more cost-effective service.
These developments are raising important questions for the policy-makers, regulators and reserve managers that are central to OMFIF’s network. The integration of disruptive technology in financial services can support economic development through improving financial inclusion But innovation can also test governments and central banks as they seek to preserve a balance with user protection and stability of the financial system.
This month’s Bulletin brings together experts from monetary authorities, governments and banks, as well as fintech companies. We have complemented this with research and analysis into central bank digital currencies, as well as podcasts and a range of meetings. In March of this year OMFIF held a joint seminar with the Czech National Bank at their headquarters in Prague on the future of money and impact of technology on finance.
Throughout these activities, we have observed the gradual filling of the initial global policy vacuum relating to the strategic understanding of these technologies and their impact on finance. There is still much to be done. Regulatory responses to fintech remain uncoordinated globally. But more and more are engaging with them, retaining in-house experts, issuing publications and collaborating to address these challenges.
Key contributors include:
- Tom Bull, director of fintech strategy at EY
- Robin Grosset, chief technology officer at Mindbridge Ai
- Rob Lovelace, vice-chairman and portfolio manager of Capital Group
- Motokazu Kasahara, finance attaché at the Embassy of Japan in Singapore