On 21 January 2016, the Standing Committee for Finance of the Dutch Parliament organised a round-table session on technological innovation in the Dutch financial sector (FinTech). In that context the Dutch Central Bank (De Nederlandsche Bank, DNB) published a position paper and research report on FinTech.
In its report, the DNB addresses the impact of FinTech and the implications thereof for its supervision. The DNB acknowledges that technological innovations in the financial sector create challenges for, amongst other things, the revenue models or stability of ICT systems of financial institutions. Technological innovation also makes it easier for financial institutions to analyse customer data, which may result in additional privacy risks. Positive effects includes increasing competition and diversity in the financial sector, as a result of which customers have a wider range of choices. The DNB analyses three scenarios where: (i) established financial institutions embrace FinTech, resulting in (relatively) small changes to the structure of the financial sector; (ii) new specialised market parties use FinTech to compete with established financial institutions; and (iii) large technology companies, such as Google or Apple, drive established financial institutions out of the financial markets by making use of their size and ability to innovate.
The DNB indicates that it will take action to facilitate technological innovation, while at the same time addressing the potential risks.
View the research report titled ‘Technologische innovatie: kansen en risico’s voor de financiële sector’ (Dutch Only), 21 January 2016.