MFW4A Participated in the 2018 AACB Continental Seminar in Chad

14.05.2018 - 16.05.2018, N'Djamena, Tchad

The MFW4A Secretariat participated in the Continental Seminar of the Association of African Central Banks (AACB), hosted by the Banque des Etats de l’Afrique Centrale (BEAC), from 14 to 16 May in Ndjamena, Chad. The event was organized under the theme “Financial technology innovations, cybercrime: challenges for central banks.”

In recent years, significant innovations in information technologies have had an impact on the financial landscape, reflected by the emergence of new actors, products (electronic and digital currencies), and business models that could have an impact on the main functions of central banks, while at the same time creating new cyber risks. It is against this backdrop that the AACB Assembly of Governors chose this theme.

The word “Fintech” has entered common usage and has become a global phenomenon. Fintech is defined as any “technologically-enabled financial innovation that could result in new business models, applications, processes or products with an associated material effect on financial markets and institutions and the provision of financial services.” Fintechs rely on a wide spectrum of ICT-related market support services such as: biometric authentication, big data, blockchain, and cloud computing services to propose a wide range of financial sector innovations (e.g. crowdfunding, mobile wallets, digital currencies, digital exchange platforms, high-frequency trading, etc.).

Financial technology innovations come with massive opportunities but also incommensurable risks, which include cybercrime. Senior officials of central banks and various guests had opportunity to reflect on the subject from an African and international perspective. In Africa, policy makers are making commendable efforts to harness opportunity offered by innovations in financial technologies to improve access to financial services. Mobile money in particular appears to meet the aspirations of the population beyond people so far marginalized by the traditional banking system.

However, there is a need also to protect consumers against potential abuses resulting from the use of financial technology innovations. Furthermore, cybercrime and the possibilities of malicious individuals to access private databases are sources of major concerns.

The participants of the Continental Seminar concurred that financial technology innovations have far-reaching implications on the money supply, the payment system infrastructure, and therefore scrutinizing their development is critical in ensuring the integrity and stability of financial systems. In this regard, the participants recommended setting up multidisciplinary “Fintech units” in central banks to follow the pace of evolving financial technology innovations.

Considering the relevance of the seminar's theme to our work carried out in the framework of the Community of African Banking Supervisors (CABS), MFW4A participated in the discussions and  also sponsored a resource person from the University of Pretoria who spoke about “The Digital World and a Human Economy: Mobile Money and Socio-Economic Development in Africa.”    

The Seminar gathered roughly 50 participants from more than 21 African central banks as well as representatives of regional organizations (i.e. WAMI, WAMA, COMESA, Federal Reserve of New-York, University of Pretoria and MFW4A). The European Central Bank (ECB) and the Federal Reserve of New-York delivered presentations by video-conference.