EU Action Plans on Fintech and on Sustainable Finance Welcomed by Banking Sector8th March 2018
The Banking & Payments Federation of Ireland (BPFI) and its affiliates strongly welcome the European Commission’s Fintech Action Plan as published today.
This renewed emphasis on Fintech at EU level is particularly important given Ireland’s own expanding fintech ecosystem. Ireland is a unique location in Europe in the way and extent to which it brings together domestic banking, global banking, leasing, funds, consultancy firms, law firms, internet darlings, indigenous start-ups and scaling companies to both collaborate and compete.
The Action Plan outlines a number of key initiatives in particular in relation to encouraging member states to explore the benefits of innovation hubs and regulatory sandboxes – initiatives which BPFI and its affiliates believe could significantly enhance the efficiency of industry collaboration on the ground if appropriately implemented here. The Commission’s commitment to analyse and identify best practices by Q4 2018 around FinTech facilitators and to present a report around best practices for regulatory sandboxes by Q1 2019 are very much to be welcomed.
BPFI also welcomes the publication of the EU Action Plan: Financing Sustainable Growth and in that context has a number of key observations to make as follows.
- Preparation for the actions required under the Plan will facilitate a welcome conversation with Government regarding the on-going development of sustainable finance at national level. BPFI members support the impetus of recent global policy initiatives – the Paris Agreement, G20, G7, OECD, UNEP FI and most recently the EU with the High-Level Expert Group report on Sustainable Finance- to mobilise investment to make a transition to sustainable finance that will mitigate climate change.
- BPFI appreciates that the recommendations for action reflect the EC’s ambitious objective to facilitate sustainable finance for the benefit of EU economies and citizens. For all stakeholders a key challenge will be to incorporate the actions required into a legislative and regulatory framework in the relatively short timeframe provided. It is positive that the EU Commission will consider sustainability as a factor in assessing implementation of Basel III reforms, for example.
- BPFI member banks are supportive of the innovative and necessary steps to achieve key objectives, namely:
- Reorient capital flows towards sustainable investment, so that growth is sustainable and inclusive
- Manage financial risks stemming from climate change, environmental degradation and social issues
- Foster transparency and long-termism in financial and economic activity.
- The development of a taxonomy of sustainable activities and standards and labels for “green” financial products is a significant positive step.
- In light of our support for the European Mortgage Federation’s EeMAP initiative, we welcome the EU’s plan to analyse the possibility of recalibrating capital requirements to encourage sustainable finance.
Banking & Payments Federation Ireland (BPFI) represents the banking, payments and fintech sector in Ireland. Together with its affiliates, the Federation of International Banks in Ireland and the Fintech & Payments Association of Ireland, BPFI has over 70 member institutions and associates, including licensed domestic and foreign banks and institutions operating in the financial marketplace here.