The 2020 pandemic is putting unprecedented strain on governments, financial markets, firms and people, requiring distinct measures for human and economic relief. Digital finance offers ways in mitigating the economic impacts and maintaining social cohesion. Technology is expected to help financial institutions and markets to transform digitally and inclusive services to strengthen people and businesses in their resilience and economic capacity. Strategies are needed for creating the ecosystems and pro-innovation regulatory frameworks that will enable Fintech and drive this digital transformation of finance.
The 4-day Fintech Innovation Lab, jointly organized by the Arab Monetary Fund (AMF) and GIZ in the framework of FIARI initiative, provided regulators and supervisors with an understanding about key enablers for resilient, safe and inclusive Fintech and with guidance about devising strategies to put these enablers in place. It included both theoretical foundations and hands-on practice through a mix of pre-recorded expert webinars, live discussions, and pitches by innovation leaders. In assisted group exercises, learning by doing led to proposals for Fintech strategies.
Technology will help financial institutions and markets to transform digitally and ultimately bring forth such inclusive services which will sustainably strengthen people and businesses in their resilience and economic capacity. But if these expectations in financial technology are to be fulfilled, it will simply take more than knowledge sharing and awareness raising. Strategies are needed to create the ecosystems and innovation-friendly regulatory frameworks that enable fintech and drive digital transformation of finance.
The Fintech Innovation Lab was conducted as a 4-day digital workshop with highly interactive, creative, and productive sessions. Leading experts provided the foundations for key enablers of resilient and inclusive Fintech. Innovative professionals from financial authorities, such as from Central Bank of Egypt, shared and exchanged on good practice in building and promoting an enabling ecosystem for digital financial services to emerge.
All 80 members from 17 Arab countries engaged in breakout groups actively in hands-on exercises to pin down challenges for developing fintech markets and to work out priority actions for digitalizing their financial systems. The digital simplified customer on-boarding and eKYC, interoperable payments systems and open banking infrastructure, financial capabilities on demand side, and e-Government or Govtech emerged as the main common issues.
Through the mixture of pre-recorded expert webinars, live discussions, pitches by innovation leaders, and the discussion across institutions and countries, the foundation was gradually laid for the third day, the heart of the Fintech Innovation Lab. On the third day of the workshop the 17 country teams went to develop offline in groups fintech strategy proposals for strengthening ecosystems and regulatory approaches towards digital financial systems.
After three intense, insightful days, the highlight of the FIARI Fintech Innovation Lab 2020 followed on the fourth day: 17 country teams pitched their fintech strategy proposals for exercises purposes followed by a round of discussions on the valuable experience in the countries.
The evaluation reveals that the workshop was a success. The Fintech Innovation Lab programme was classified by the participants as “helpful” in all areas and the overall experience tended to be rated very good rather than good. Furthermore, most respondents (40 out of 42) are feeling very well positioned or good positioned to lead innovation topics in their organization and to drive digital financial transformation. In addition, respondents highlighted that they gained knowledge about the foundation of fintech strategies (33 out of 42) and innovative regulatory approaches (30 out of 42). Although the evaluation results also show that there is a demand for more in-depth measures on fintech innovation, 29 out of 42 respondents indicated that they have gained practice in developing a strategy to strengthen ecosystems and regulatory frameworks for fintech.
The Fintech Innovation Lab laid the foundations for key policymakers and regulators in spearheading more resilient, inclusive digital financial systems. The workshop also re-enforced the AMF’s intention in taking forward the key stakeholder consultations among Arab Central Banks and Monetary Authorities in developing guidelines for a regional approach to digital financial transformation, which were successfully endorsed by the Council of Governors in September 2020.