Institutional Arrangements for Fintech Regulation: Supervisory Monitoring
Electronic Access:
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Summary:
The impact of fintech is growing rapidly worldwide, although this growth is uneven across jurisdictions. Depending on the effect of fintech, authorities may adopt a passive approach of monitoring fintech, try and capture new business models in existing regulatory frameworks, develop bespoke regulation, or adopt test and learn policies through institutional arrangements like innovation hubs and sandboxes. The test and learn approach is relatively unique to fintech in financial regulation and supervision and has advantages and disadvantages. While it can help authorities monitor and respond to the challenges of fintech in some scenarios, in others it could lead to risks to consumers and markets, particularly when designed poorly or with an unclear use case. Ultimately, the aim for authorities should be to consider fintech regulation part of the mainstream, where fintech expertise is embedded throughout an organization and not siloed to specific fintech units.
Series:
Fintech Notes No 2023/004
Subject:
Economic sectors Emerging technologies Financial crises Financial services Fintech Technological innovation Technology
Frequency:
occasional
English
Publication Date:
June 26, 2023
ISBN/ISSN:
9798400245664/2664-5912
Stock No:
FTNEA2023004
Format:
Paper
Pages:
58
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