The Central Bank Governor, Patrick Njoroge has started warming up to fintech.
In a virtual conference hosted to launch Dialogue on Global Digital Finance Governance, Njoroge said digitisation has been the silver lining in the dark cloud of the coronavirus pandemic.
“Fintechs have enabled official and personal transfers to vulnerable households and facilitating essential social services including health and online shopping,”he said.
He however noted that the sector which presents many opportunities comes with many risks, particularly of market concentration by big Fintechs therefore making a global discourse on the sector is imperative.
In March last year, Njoroge likened fintechs, especially lending apps to shylocks, hiding behind nice-looking applications.
He said, the lack of adequate guidelines has opened up room for rogue players making it hard for consumers to differentiate from ethical lending platforms.
The event which was put in place to implement one of the key recommendations of the UNSG Digital Finance Task Force was meant to catalyse international and corporate governance innovations to ensure BigFintechs benefit all.
“Many positive developments have happened that align fintech with sustainable development, which need to be built upon,” said Achim Steiner, co-chair of the Digital Finance Task Force and UNDP Administrator.
Steiner added that strengthening the opportunities and mitigating the risks with governance innovations will ensure that BigFintechs and fintechs follow a similar path in supporting the greater good.
BigFintechs are the new giants of tomorrow’s financial system, with technology driving an upsurge in growth, scale and diversification into financial services.
Such BigFintechs originate from different contexts, from China’s AntGroup to Africa’s numerous mobile money companies, Facebook Pay, Amazon and Google in the US.
These platforms have positive impacts from deepening financial inclusion to creating livelihood opportunities to enabling direct citizen action but also bring new challenges.
Some of the issues discussed at the event include market concentration, data governance and monopolisation risks, the role of e-commerce platforms to facilitate access to global markets, taxation issues, digital currencies’ macro-economic impacts in developing countries.
“Good governance of Big Tech and Fintech is one of development’s cutting edge issues that will define tomorrow’s world. It requires a new geometry of actors to ensure that no one is left behind,” said Christian Frutiger, Assistant Director, Swiss Agency for Development and Cooperation.