From the meeting of the International Monetary Fund (IMF) in 2018;

Some statements from each representative in the meeting:

Perry Warjiyo (Governor, Bank of Indonesia): People should embrace the digital economy and finance.

Joko Widodo (Indonesia President): As the digital economy and innovation spread throughout the world; The world is in the midst of another world innovation; examples, Alipay, Applepay. The previous world innovation was the emergence of the internet. The new era of innovation is the emergence of fintech such as blockchain and cryptocurrencies.

Similar to internet boom many years ago, the world should allow innovation (emergence of cryptocurrencies and blockchains) to flourish just like the beginning of the era of the internet. Innovation comes from experimentation.

There should be oneness to global standards and global platforms that will help in the innovation and flourishing of financial technologies.

Geoff Cutmore (Anchor, CNBC): Financial technology (Fintech) is disruptive.

What is fintech: The introduction of technology to introduce into peoples’ life to make it easier. Technology is creating and transforming the financial landscape.

Christine Lagarde (Managing Director, IMF): Fintech should be used by as many people in the world, and should not damage the financial system.

Jim Yong Kim (President, World Bank): Fintech changes frequently, and it’s hard to keep up.

Lesetja Kganyago (Chair of the International Monetary and Financial Committee: With the innovation of financial technology; there would allow people and also deliver the financial services. The citizens will have more access and finance would be more cost effective. This cost effectiveness will also bring down cross border of remittances and also the costs.

Mark Carney (Chair, Financial Stability Board): There will be more access to more services as more innovations take place and also there would be more competition. This competitive will benefit small businesses. This innovation will also improve the stability of the financial system.

Real-time gross settlement (RTGS) systems in Europe is reforming. Cross border payments are expensive. The banks can empower digital identifications and other innovations to try and be more cost effective. Improving the quality of access will also entice more competition.

Key points from the Meeting and the Discussions:

The technology innovation will help with the inclusion and cost effectiveness of financial systems. Examples are companies like: Tencent, and Alibaba can use payments of up to $150,000 with instant payment.

The main issue of financial systems is the fear of liquidity from the existing legacy banking system that this fear has been built over decades.

Old business model had heavy overhead costs. New model shows cost effectiveness and also more of a benefit for the people.

Is there a general principal in this innovation:

The benefits arise from the system. This technology creates disruption. There are a lot of fintech principles that are deployed. The banks have to prepare for the blockchain. It’s better to be open and allow the world to take upon the technology. The global economy is much more distributed such as peer to peer.

With this technology is low barrier to entry and also can happen anywhere and has ability to scale and also can disrupt.

Citation: The Fintech Agenda; https://www.youtube.com/watch?v=L1AFJCNORcI