Senior financial regulators outline priority convergence topics
First-of-its-kind Global Dialogue on Inclusive FinTech ended with an outline of priority convergence topics, including payment innovations, payment system oversight, fintech ecosystems, cybersecurity, data protection and privacy, financial capability and wellbeing as well as digital banking innovations.
Over the past two days, senior policy makers from developing and developed countries, co-hosted by the Czech National Bank (CNB) and AFI, met in Prague to share knowledge and experiences and find practical solutions that answer to emerging policy challenges faced by countries at all stages of development.
“Financial Inclusion covers a larger agenda, crucial for advanced economies as well,” CNB Board Member Oldřich Dědek, said in his closing remarks on 28 September. He highlighted the phenomenon of big data, collected through social media and other channels where consumers leave digital footprint, adding that “financial institutions could get better evaluation of client risks and based on this knowledge even exclude some customers from using risky financial instruments”.
Dědek shared his impression about the distinction between the developing and developed countries noting that European Union is not paying enough attention to global developments because it is too focused on implementation of Europe-wide initiatives, such as PSD2 (Second Payment Services Directive) or GDPR (General Data Protection Regulation)
“The advantage of developing countries is that while catching up, they can leapfrog the current business models or technologies that are slowly becoming obsolete and thus reach the cutting egde earlier than us”, Dědek said.
With central banks facing more challenges posed by the digitalization, Dědek said as he underlined value of the global dialogue and its frank exchange of views. He announced that CNB will create a platform to help FinTech companies “clarify existing regulation and organize exchange of views”.
Regulatory landscape has already changed due to FinTech and we are seeing regulators from around the world coming together to find regulatory responses, AFI Executive Director Dr. Alfred Hannig noted.
In Europe, technological advances are strongly enhancing convenience and efficiency, while in countries without such legacy, leapfrogging is so dramatic that some steps are left out and emphasis is on non-bank financial providers, Dr. Hannig said explaining how he was struck by the session on payment systems.
“We will document what has been done over the past two days and come out with suggested activities to undertake under a workstream that has emerged here”, Dr. Hannig said in his concluding remarks. As a member-based organization, AFI Management Unit will synthesize findings and results and share with the rest of the network, he added. Dr. Hannig thanked the CNB for co-hosting the event and excellent organization.
Representing a cross-section of key stakeholders included speakers from central banks, regulators, private sector firms, global development organizations, research institutions and academia. They provided an in-depth perspective from across the globe and shared experiences from their home countries, including Argentina, Armenia, Egypt, Estonia, Finland, Ghana, Luxembourg, Malaysia, Nigeria and Spain.
Among the event’s many outcomes is development of key policy takeaways that is expected to form concrete follow-up actions for fostering intellectual partnerships among financial regulators from diverse jurisdictions. These policy lessons will be adopted in the network to advance in-country implementation.
“We are here to learn globally and apply locally,” Dr. Hannig told participants.