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Opportunities, challenges and policy implications of digitalisation for the EU financial sector

Day 3 Morning

Friday 13 September

Room :

Fennia I - Roundtable

Speakers

Chair
Levin Holle - Director General, Financial Markets Policy, Federal Ministry of Finance, Germany
Public Authorities
Claire Bury - Deputy Director-General, DG CONNECT European Commission
Leena Mörttinen - Director General, Financial Markets Department, Ministry of Finance, Finland
Joachim Wuermeling - Member of the Executive Board, Deutsche Bundesbank
Industry Representatives
Ksenia Duxfield-Karyakina - Government Affairs & Public Policy Manager, Google Cloud, EMEA
Santiago Fernández de Lis - Head of Regulation, BBVA
Francesca Hampton - Chief Financial Officer, Cynergy Bank

Objectives of the session

Many technology disruptions are impacting the EU financial area and new services are emerging (instant payment, crowdfunding, robo-advice, …). The financial players in the EU, are leveraging these opportunities to improve customer experience, cost efficiency, and reduce the level of risk (AML, credit risk assessment…). Many of these evolutions are led by fintechs, which in many cases are partnering with incumbents which are struggling to make existing organisations further “agile” in order to genuinely leverage digital developments. New service providers are also emerging notably as AI is further accelerating the pace of “disruption”.

In this swiftly evolving context, EU policy makers have already completed various regulatory initiatives in order to lift obstacles to internet transactions and digital innovation (improved access to data within banks (PSD2), improved access of EU citizens to internet and cellular networks (Single Digital Market Strategy), Fintech action plan, …). GDPR in particular have started to address the issues related to personal data in a digitalised world.

The objective of the session in this context is to take stock of the evolutions witnessed and the challenges raised (adaptation, new risks, new value chains, new players, new financial and non-financial regulations) in order to identify the most appropriate policy priorities required in the financial sphere to strike the appropriate balance between innovation, safety and fair access to the market.

Points of discussion

What are the main challenges faced by existing financial institutions/infrastructures in terms of digitalisation? What is the magnitude of the investment related to digitalisation faced by financial institutions? How do they combine this with the additional demands imposed by the recent prudential overhaul completed in the EU? Are there emerging risk and financial stability issues arising from the digitalisation of financial activities?

Can digitalisation contribute to strengthening the EU financial sector and what are the business challenges it raises?

What are the regulatory priorities to achieve sustainable innovation in the “digital financial area” in the EU? What are the main challenges faced by policy makers to striking the right balance between innovation stimulation, improved data fairness and mitigating emerging (digital related) risks? Do recent EU regulations reduce or favour the ability of the diverse possible players to contribute to a safe and innovative digital transformation of the Eu financial area? Should financial regulation be more activity-based and less entity-based? What are the priorities in this field?