Today’s European Commission adoption of a comprehensive package on digital finance is a major step towards the comprehensive regulatory framework for financial services that will help make the European Union fit for the digital age, according to the European Banking Federation.
The package consists of important Commission strategies on digital
finance and retail payments, together with legislative proposals on
operational resilience and crypto assets. The EBF and its members have
contributed in all relevant consultations.
The EBF shares the Commission’s ambition that Europe should drive
digital finance with strong European market players in the lead. The EU
financial sector should embrace all the opportunities brought by
digitalisation. The benefits of digital finance should be available to
European consumers and businesses and Europe should promote digital
finance based on European values and a sound regulation of risks.
The EBF believes that these objectives can only be achieved if the EU framework strives for:
- a technology-neutral and innovation-friendly EU financial services framework
- fair competition in a digitally transformed market, characterised by a level playing field, with proportionate regulation – ‘same activities, same risks, same rules, same supervision’ principle
- cross-sectoral data sharing for the benefit of European consumers and businesses
- balanced innovation and proper protection of investors and consumers
- a resilient financial ecosystem with common minimum
security requirements, following a risk-based approach, including
critical third-party interdependencies, while avoiding disproportionate
burden on financial institutions
- stronger sovereignty in payments through pan-European initiatives.
Says Alexandra Maniati, Director of Cybersecurity & Innovation at the EBF:
“The Covid-19 crisis has strongly highlighted how
important all aspects of digital transformation are for our society.
This ambitious Commission initiative for the financial sector comes at a
crucial time. The EBF is keen to continue working with policy-makers so
that European ideas shape the future of digital finance; with an
innovative European banking sector, that is resilient and globally
competitive, in a level playing field, to the benefit of European
consumers and businesses.”
The EBF key messages in the areas highlighted by the Commission packages are as follows:
Digital Finance Strategy
The EBF supports the Commission’s aim to alleviate
fragmentation in the Single Market for digital financial services
and underlines that cross-border coordination within the EU and globally
will positively affect the ability of banks to leverage new
technologies, such as cloud computing and AI, to help boost efficiency
and deliver improved services for consumers. The EBF welcomes the
Commission’s ambition to promote a data-driven financial sector.
However, initiatives to increase data sharing should not focus on
financial services where this has been done already through previous
legislation, but instead should take a view to establish a
cross-sectoral data sharing framework for the benefit of consumers and
firms. EBF members also see merit in exploring together with
policy-makers the potential of a European digital identity based on the
e-IDAS framework, taking into account existing national ID schemes and
ensuring the necessary safeguards, interoperability and public-private
cooperation to achieve the desired scale.
Retail Payments
Recently payments have been increasingly highlighted as an area of
strategic importance for European sovereignty and the international role
of the euro. At the same time, the payments market is a highly
competitive and innovative area of financial services, at the forefront
of digitalization. The Commission’s aim to support e.g. competitive
home-grown and pan–European payment solutions is shared by the EBF. The
Federation also supports the vision of the strategic value of payments
and looks forward to contributing to shape the future outlook of the
European payments market.
Operational Resilience
The impact of the Covid-19 pandemic has illustrated increased
reliance on digital and remote technologies. The EBF welcomes the
European Commission’s recognition of the need to reinforce the digital
operational resilience of financial market participants. The
interconnectedness of all actors within the financial ecosystem,
including third party providers, and the evolution of ICT risks
highlight the need for a common level of minimum security for the
financial sector as a whole, based on international coordination. The
EBF encourages the European Commission to address the upcoming
reinforcement of operational resilience according to the
responsibilities of market participants in customer-provider
relationships for innovative service solutions, respecting the principle
of proportionality.
Crypto assets
The EBF welcomes the Commission addressing the opportunities,
challenges and risks by crypto assets in a holistic approach, aiming to
support blockchain technology’s potential throughout Europe. It is
important to balance innovation and protection of consumers and
investors. Where crypto assets qualify under existing regulation,
protection is offered. But with emerging, non-covered crypto asset types
– potentially having significant impact on consumer protection and
monetary policy– the regulatory framework should answer appropriately.
Based on the principle ‘same services, same risks, same rules’, risks need to be prevented by addressing issues such as transparency and supervision, avoiding fragmentation across the EU.
EBF
© EBF
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