Open Close 00:00 Digital finance has really been a lifeline for the millions of people that have been under lockdown right.So how will this provide an opportunity to reshape finance and why is that needed right now .Thank you for having me and Sherry as you say.Finance had already begun transforming itself as the financial markets for digitalisation and digital technology but with the pandemic has shown us just in these few months is how rapidly governments but also financial markets consumers have had to adapt and digital technology has actually allowed us to amplify the ability to reach people but also for finance to reach people.And I think what the sector general said helping me establish this taskforce would need us from central banks but also business leaders financial companies wants to explore.Could this revolution in finance also be a revolution for development finance.And this is what the report set out to explore.
And suddenly the pandemic has already shown us extraordinary programs being set up to stabilize economies to reach the point where it goes much deeper.It’s crypto currencies it’s mobile platforms peer to peer lending and crowd funding.These are all examples of the opportunities that digital finance represents and that’s what the task force focused on .The finance of course also presents risks like it’s vulnerable to manipulation exploitation as well.How important is it that you have effective oversight while you’re trying to really achieve the sustainable development in digital finance .In two respects it’s critical to understand that this is really an ecosystem in which financial players but also citizens.And the reason why the report shows the headline title of people’s money is also to remember that one of the challenges is the misalignment to what people want to see their money being invested in where let’s say the financial economy has invested .
And I think that is one way in which we can look at this ecosystem being brought together.The second one is clearly government regulatory and policy incentives are critical to shape this market as it evolves so rapidly as to protect fundamental data rights human rights of citizens.But also just like in the past with registered trademarks intellectual property government regulatory frameworks enable fair competition transparency and governments have a critical role to also put the foundations in place.For instance in India the announcement did not connect four villages to fiber optic cable in the next 1000 days.It’s precisely the kind of public investment and policy that seed in this pandemic to recover.It also lays the groundwork for an extraordinary and much more inclusive digital finance revolution to become possible .Is there enough global and regional coordination between governments on this issue .
I think right now one would have to say it is one of those frontier moments.Technology leads and I think in many contexts governments societies are still trying to catch up with the possibilities.Take the issue of crypto currencies such as block chain central bank governors and G 20 are struggling to figure out is this an enlargement or financial system opportunity or is it a risk to the system.
The same as algorithms they could exclude significant numbers of the population simply by certain criteria.
On the other hand what the report presents is also fantastic examples of how with a ISE suddenly lending to small and medium sized enterprises can be transacted in seconds using the kind of data and technology that’s available trust and financial flows out in China.In the midst of the pandemic being able to provide 20 million loans to small medium sized enterprises the backbone of our economy .Also this pandemic.
As a matter of seconds for transaction .And I think these are the opportunities that require solid incentives regulations and alignments that protect citizens but also create the opportunity for revolution to actually occur which is really the frontier of what we are seeing right now .
In which countries are you most optimistic that you see this convergence of both opportunity as well as the the adequate government oversight and initiative .Well I provided you two examples already in India and in China at one private sector led the other one government policy.But I think one of the fascinating things that we have learned as a task force is that the frontier of experimentation and innovation is not at all confined to the traditional technology centers of our global economy.You take an example such as Kenya.In Kenya the mobile platform has become an integral part of the economy and every virtually every citizens transact on it .
You can go to Bangladesh where government bonds are now being set up and tapping the micro savers in order to aggregate domestic savings to finance national development projects.
You could go to Brazil with these Social Security and welfare programs there and look at e-government and the extraordinary amount of money government has saved by moving onto e-government platforms and making digital transfers.Electronic in India alone estimates over 22 billion dollar sales since they introduced this digital transfer payments.So more efficient government more efficient markets also more inclusive financially economies.Because one of the great breaks was with digital has been that literally hundreds of millions of people who did not exist on the right of our financial system in the past.
They have no credit no address no collateral are able to borrow money in the morning buy their goods take them to the market repay in the evening and have a library.These are the kinds of examples that will transform our economies and hopefully with a strong emphasis on equity and sustainability because these will ultimately also ensure a more stable political and financial system .For You .