EU Digital Finance Strategy: EBF responds to EC consultation
Publication date: 1 July 2020
The European Banking Federation has submitted its response to the European Commission consultation on an EU Digital Finance Strategy. Click here for the contribution submitted by EBF.
The EBF welcomes the European Commission’s initiative to present a new Digital Finance Strategy this year and its commitment to support the development of digital finance in the EU. This is crucial in the view of European banks, who continue their work to ensure a secure digital transformation of financial services, shaping new business processes and delivering on client expectations in a digital economy.
The EBF supports the four priority areas identified by the Commission for policy action:
- ensuring a technology-neutral and innovation-friendly EU financial services framework;
- realizing the opportunities offered by the EU Single market for digital finance services addressed to consumers and firms;
- promoting a data-driven financial sector;
- enhancing its operational resilience.
In this context, we stress that ensuring a level playing field must be a key objective of a technology-neutral, innovation-friendly policy approach. Only by ensuring fair competition among all actors can the EU maximize the benefits of digitalisation in finance. We therefore firmly support the Commission’s commitment to the principle of “same activity that creates the same risks should be regulated in the same way” and recommend that the Commission promotes innovation by all actors under fair and even conditions, including in areas such as access to technical infrastructure outside of the traditional financial sector.
The challenges that still exist in the functioning of the Single Market and the lack of effective harmonization in rules, supervision and enforcement are key obstacles to the ability of banks to fully develop their potential and successfully compete in the digitalised environment. The EBF strongly supports the Commission’s aim to remove fragmentation in the Single Market for digital financial services, and underlines that cross-border coordination within the EU and globally is fundamental, particularly as digitalisation increases the cross-border provision of financial services. Fragmentation also impacts the ability of financial service providers to leverage new technologies, such as cloud computing, AI, and blockchain, which can help both in boosting efficiency and in delivering improved services for consumers.
The EBF welcomes the Commission’s ambition to promote a data-driven financial sector as part of its overall goal to build a EU data economy, as set out in the EU Data Strategy. However, we would like to emphasise that initiatives to increase data sharing should not focus on financial services where this has been done already through previous legislation. Valuable opportunities for data-driven innovation for consumers and firms will come from reusing and combining data across sectors. We therefore encourage the creation of a cross-sectoral data sharing framework, which puts users – individuals and firms – in the centre.
Finally, financial literacy and financial education are vital in helping empower consumers so that they are able to fully take advantage of the opportunities of digital financial services, and contribute to en effective consumer protection. The EBF strongly supports further actions to boost financial literacy and education across the EU, with the participation of a broad range of stakeholders.