Delegates from private and public sector gathered for a panel discussion this weekend.The panel was about the role of technology in achieving greater global financial inclusion.The panel was a part of a 4-part seminar series at the Annual Meetings of the World Bank Group and the International Monetary Fund in Washington, DC.Peter Sands, Mauricio Cardenas; Bill Gajda, Jennifer Nason and Dean Karlan were some of the panelists.
The discussion was moderated by Stanley Fischer, the vice chairman of the US Federal Reserve board.In the beginning, chief executive of Standard Chartered Bank group Peter Sands talked about the importance of business model reforms to allow technology to make commercial and operational impact in the financial services industry.Sands also introduced “cyber currencies – bitcoin and so on” later. He said he was not convinced that they will become anything more than a niche application, but called the block chain technology involved a true computational innovation.Gajda shared the same sentiments and said that a lot of work needs to be done to address things like micropayments transaction costs and interoperability issues.Delegates from payments and banking industries gave favorable responses by accepting that new technology and innovation are now a part of the financial services.
Gajda stated that interoperability will help reach the next level of scale. Some business model innovation from everyone is required to move up.He did not talk about crypto currencies specifically but it was clear that he referred to Bitcoin several times when discussing how technology helps the financial services grow.He noted that he is very confident about the rate of technological advancement in certain markets.
He believes technology will make payments scalable and secure.He thinks there are some business model barriers and lack of consumer education plays an important role behind it.The counterpart to the financial aspect of financial inclusion is fundamental property rights.Sands was enthusiastic about the bitcoin technology’s potential to succeed and also to reform titled property.He explained that one can transfer title to the product he is buying.
If users want to be economic actors, they should have the chance to establish and transfer property rights.This is especially important because people acquire entrepreneurial tools and skills, to become business owners eventually. In such fields the block chain technologies could prove to be really powerful.Cardenas talked more about the currency aspect of crypto currencies. He maintained a critical attitude toward the emerging technology during remarks.
When inclusion was discussed, he stressed on the need for money transfer system in which senders do not need to pay transaction fees, which are often as high as 10%.Cardenas said that it is necessary to ensure that users of overpriced services have access to technologies they can take advantage of. He indicated to using less cash.He also shared that whenever he thinks of the leading digital currency bitcoin, he is reminded of the value of controlling money.
