Big Tech and the Future of Finance
IMF SEMINAR EVENT
DATE: October 16, 2019
DAY: Wednesday
10:00 AM - 11:00 AM
LOCATION: IMF HQ1 Atrium (HQ1-1-700)
Moderator Elizabeth Schulze of CNBCi gives us the key take-aways from this IMF seminar.
Overview
Big Tech are entering Fintech. They bring technology, deep pockets, massive networks, mountains of data, and great user experiences. But also risks. Can they reshape banking and finance? We ask Big Tech, banks, and regulators to look into the future.Join the conversation via #NewEcon #Fintech
Big Tech and the Future of Finance
Key points
The entry of large technology firms, “Big Tech”, into financial services could deliver significant efficiency gains and enhance financial inclusion. At the same time, regulators need to consider and mitigate the risks that may come with such new entrants. Panelists discussed the complex trade-offs, including financial stability and inclusion, competition, and data protection.
- Benefits of Fintech. Panelists agreed that the current financial system needed to evolve. They highlighted that financial service consumers, across both developing and advanced economies, face significant costs and inefficiencies, as well as other limitations to accessing finance. Marcus stated that at present 1.7 billion did not have access to digital finance. Commenting on the experience in India with national digital financial inclusion programs, Nilekani noted that such programs had enabled the creation of 330 million new accounts over a short time period.
- Role of Big Tech. Panelists recognized the potential role of Big Tech in driving important change in the financial services industry, including through its ability to scale basic financial services at a low cost. Carney noted that global digital currencies, like the proposed Libra, may assist in de-dollarizing the global financial system, while also recognizing the potential volatility that could be created for domestic currencies. Panelists also noted the risks that new entrants may bring, including reduced competition, given Big Tech’s already established large customer bases, as well as financial stability, consumer protection, and data privacy concerns.
- Policies. Panelists emphasized the need to ensure that consumers could fully benefit from the technologies, including through the interoperability of Big Tech financial services. In particular, Furman noted it was important that policymakers take action to avoid the build-of market concentration. Carney stated that it was imperative for central banks to play a central role in the digital financial system, while keeping up with innovations. In his opening remarks, Lipton highlighted the Bail Fintech Agenda and Fund’s efforts in assisting policymakers in thinking through the challenges and opportunities of fintech.
Panelists
Opening Remarks: David Lipton
Moderator: Elizabeth Schulze
Panelist: Mark Carney
Mark Carney is the Governor of the Bank of England and Chair of the Monetary Policy Committee, Financial Policy Committee and the Prudential Regulation Committee. His appointment as Governor was approved by Her Majesty the Queen on 26 November 2012. The Governor joined the Bank on 1 July 2013.
In addition to his duties as Governor of the Bank of England, he serves as First Vice-Chair of the European Systemic Risk Board, a member of the Group of Thirty and the Foundation Board of the World Economic Forum.
Mark Carney was born in Fort Smith, Northwest Territories, Canada in 1965. He received a bachelor’s degree in Economics from Harvard University in 1988. He went on to receive a master’s degree in Economics in 1993 and a doctorate in Economics in 1995, both from Oxford University.
After a thirteen-year career with Goldman Sachs in its London, Tokyo, New York and Toronto offices, Mark Carney was appointed Deputy Governor of the Bank of Canada in August 2003. In November 2004, he left the Bank of Canada to become Senior Associate Deputy Minister of Finance. He held this position until his appointment as Governor of the Bank of Canada on 1 February 2008. Mark Carney served as Governor of the Bank of Canada and Chairman of its Board of Directors until 1 June 2013.