In April 2018 the Intergovernmental Fintech Working Group (IFWG) held a workshop involving regulators, policymakers and participants in the financial services industry to discuss the rise of fintech and develop an approach to technical innovations for the benefit of all South Africans.
The gathering was hosted by the Financial Intelligence Centre, National Treasury, the Financial Sector Conduct Authority and the South African Reserve Bank.
The recently released report, issued by the abovementioned institutions, says the fact that the working group was formed and the workshop held signals the important of financial technology (fintech) in the industry.
“This phenomenon has the potential to reshape the financial services industry by removing market inefficiencies,” says the report. “Novel solutions resulting from exploiting emerging exponential technologies such as application programming interfaces, big data, blockchain, cloud computing, distributed ledgers and emerging alternative internet-enabled platforms claim the potential to reduce frictional costs, lower information asymmetries (for consumers and providers) and decrease moral hazard. Improving overall social welfare may be one of fintech’s greatest promises.”
The report goes on to unpack the discussion points that were raised at the meeting, concluding with reflections on regulatory and policy issues and a summary of the high level sense of achievement that delegates felt.
“The market participants and fintech firms present noted how fortunate they felt operating in a market where regulators were open to dialogue and were interested in hearing their views and challenges on regulatory issues,” says the report. “All agreed that the positive momentum generated by this inaugural workshop needed to continue on an ongoing basis, and the private sector was looking forward to being provided with more opportunities for dialoguing with regulators.
“There was a sense of excitement throughout the workshop on the market-leading innovation that is taking place within South Africa, adding credence to the notion that South Africa remains a world-class financial hub in Africa. The market participants, in particular, were excited that regulators were taking steps toward making the environment in South Africa more enabling for innovation, showing that South Africa was indeed ‘open for business’ to investors and entrepreneurs looking to make an impact in the local financial market.”
Header photo credit: Co-Pierre Georg (@co_georg)