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Digital Finance Strategy

Context

Technology is playing an increasing role in financial services and becoming a key success factor in all the main sectors of finance and in all steps of the financial value chain, a trend which has accelerated with the pandemic. Technologies such as cloud, AI and DLT help to improve efficiency in the provision of financial services and also support innovation e.g. in terms of new product development, personalisation and time to market. They moreover facilitate risk management, supporting reporting, supervisory processes, AML and fraud detection.

These new technologies may however pose new challenges in terms of exposure to cyber-risk, dependency on third-party providers, accountability and may raise issues with regard to appropriate data use, sharing and sovereignty. Potential regulatory obstacles may also hinder the digitalisation of financial services and their deployment on a cross-border basis.

The European Commission proposed in September 2020 a Digital Finance Strategy (DFS) aiming to support the digital transformation of the EU financial sector. The objectives of the DFS initiative are to adapt the financial regulatory and supervisory framework to the increasing digitalisation of the EU financial sector, remove potential obstacles to digitalisation on the domestic and cross-border levels, establish a common European financial data space to facilitate data-driven innovation and also address possible new risks and level playing field issues related to this digital transformation. The DFS is part of a broader Digital Finance Package including four additional legislative proposals aiming to support the digitalisation of EU financial services: MiCA (regulation on markets in crypto-assets), the DLT pilot regime, DORA (the Digital Operational Resilience Act) and a retail payments strategy for the EU.

Contributions to the policy debate

Extracted from the main Eurofi publications (Regulatory Updates, Views Magazines and Conference Summaries)

Public and private
sector views

Tech in finance: opportunities and challenges - February 2022 new

Marcel Haag - European Commission | Akash Shah - BNY Mellon | Tsvetelina Penkova - European Parliament | Georgina Bulkeley - Google Cloud | Märten Ross - Ministry of Finance, Estonia

Digital transformation and policy implications - September 2021

Paulina Dejmek Hack - European Commission | Tsvetelina Penkova - European Parliament | Sébastien Raspiller - Ministry of the Economy, Finance and the Recovery Plan, France - Direction Générale du Trésor | Bernd Leukert - Deutsche Bank AG | Colin Fitzgerald - Invesco | Kristine Braden - Citigroup Global Markets Europe AG

Tech companies in finance - September 2021

Fernando Restoy - Financial Stability Institute | Natasha Cazenave - European Securities and Markets Authority | Lie Junius - Google Cloud | Daniel Kapffer - DekaBank Deutsche Girozentrale | Diana Paredes - Suade Labs

Digital Finance Strategy - April 2021

Marcel Haag - European Commission | Harald Waiglein - Federal Ministry of Finance, Austria | Isabel Guerreiro - Banco Santander | Bjørn Sibbern - Nasdaq | Märten Ross - Ministry of Finance, Estonia | Sebastien Raspiller - Ministry of the Economy, Finance and the Recovery Plan, France

Adapting the financial framework to digitalization - April 2021

Fernando Restoy - Financial Stability Institute | Rui Peres Jorge - Portuguese Securities Market Commission | Stephane Janin - AXA Investment Managers | Francesco Ceccato - Barclays Europe

Financial data space and cloud infrastructure - April 2021

Joachim Wuermeling - Deutsche Bundesbank | Tsvetelina Penkova - European Parliament | Christopher Buttigieg - Malta Financial Services Authority | Ksenia Duxfield-Karyakina - Google Cloud | Daniel Kapffer - DekaBank