What are the implications of fintech for the financial sector? This is the question being asked by Basel Committee on Banking Supervision in a consultative document released this week.
Sound practices: Implications of fintech developments for banks and bank supervisors asks how technology-driven innovation in financial services will affect the banking industry and the activities of supervisors.
The document looks at various possible scenarios and the potential impacts of a variety of technological innovations in the financial space, from mobile-only banks and mobile wallets, to digital currencies and person-to-person payments, as well as high-frequency trading and robo-advice. It also contains three case studies on technology developments in big data, distributed ledger technology and cloud computing, as well as three case studies on fintech business models (innovative payment services, lending platforms and neo-banks).
The committee notes that banking standards and supervisory reach have to adapt to technological innovations – while “maintaining appropriate prudential standards”. The committee has therefore launched a consultative document – mainly for banks and banking supervisors – on the topic and is inviting comment until Tuesday 31 October 2017, to be submitted through this link.
CTMFile take: The consultation is aimed at banks and banking supervisors but the document published by the Basel Committee provides an overview of how fintech is changing the banking sector as well as the opportunities for 'suptech' (supervisory technology).
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