Central banks should take the lead in the field of financial innovation

WILLEMSTAD / PHILIPSBURG – “There is an important role for central banks to take proactively and steer the changes and reforms that are currently taking place in the financial sector,” said Leila Matroos-Lasten, president ai of the Central Bank of Curaçao and Sint Maarten (CBCS) during the Bridging Financial Innovation and Regulation Seminar 2018. “The big challenge for central banks is to find the right balance between the clear advantages that financial innovations entail and to identify and limit. of the corresponding risks, “she stated.
As already announced, the CBCS organized the Bridging Financial Innovation and Regulation Seminar 2018 in collaboration with Cinex on 28 and 29 June. The seminar aimed to inform the public about the latest developments in the field of technological innovation in the financial sector. sector, also known as FinTech. The seminar focused mainly on the possible implications of these developments on the financial sector and the need for a new form of supervision.
In particular, the FinTech sector, which has grown spectacularly in recent years, has had several startups, which have made the financial sector cheaper, more efficient or more user-friendly by means of creative solutions. Matroos-Lasten further explained that FinTech is an important driving force for competition, consumer choice and innovation in the market. “Nevertheless, FinTech also brings new risks. If these risks build up in an unregulated sector, this may damage financial stability in the long term, “says Matroos-Lasten.
“Supervisors worldwide will have to closely monitor all developments in the field of innovation and FinTech in order to prevent financial stability
coming. On the other hand, the regulations must also provide enough room for more innovation by, among other things, removing unnecessary legal bottlenecks that stand in the way of that innovation, “she said.
“Central banks around the world recognize this danger and have recently adopted a less conservative attitude. An example of this is that many central banks are currently investigating the possibilities for issuing digital coins. It is therefore very important that central banks also innovate and establish themselves as innovation leaders, “she added.
The president a.i. of the central bank also indicated that, in order to maintain confidence in new financial services or activities, good supervision is essential, both for consumers and for other market parties. This places a great deal of value on the input of all stakeholders with the aim of better aligning the supervisory approach with the changing financial sector.
“The main assets of the central bank are no longer the gold in the safe, but the trust that the central bank enjoys from the public. Bridging financial innovation and regulation is therefore essential to ensure that financial innovations can contribute to sustainable economic growth and social welfare. Only by doing so can central banks remain worthy of the public’s trust, “concluded Matroos-Lasten.
The presentations of the seminar will be published on the website of the CBCS on Tuesday, July 3 a.s. The presentations of the sessions of 28 June can be seen on the Facebook page of the CBCS.