Fintech Payments in Public Financial Management: Benefits and Risks PDF Download

Author: Gerardo Uña
Publisher: International Monetary Fund
ISBN:
Category : Business & Economics
Languages : en
Pages : 36

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Book Description
Fintech payments leverage large digital platforms to fill gaps in the traditional payment system. They have made great strides in increasing access to payment services in several countries around the globe. At the same time, like any innovation, the new payment models are exposed to risks in their operating environment. We review the main fintech payment models (mobile money, internet-based fintech payment, and digital money) and discuss operational and financial risks as well as challenges they face. We then explore how public financial management (PFM), especially treasury payments and non-tax revenue collections, could benefit from fintech payments by providing examples of early fintech applications in different countries and discuss the challenges of integrating them into the public sector. The use of fintech in public finance could bring various benefits—including strengthening fiscal transparency, improving budget planning and execution, and upgrading cash management—if public sector institutional and technological capacities are strengthened and risks are adequately mitigated.

Author: Ms.Ratna Sahay
Publisher: International Monetary Fund
ISBN: 1513512242
Category : Business & Economics
Languages : en
Pages : 83

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Book Description
Technology is changing the landscape of the financial sector, increasing access to financial services in profound ways. These changes have been in motion for several years, affecting nearly all countries in the world. During the COVID-19 pandemic, technology has created new opportunities for digital financial services to accelerate and enhance financial inclusion, amid social distancing and containment measures. At the same time, the risks emerging prior to COVID-19, as digital financial services developed, are becoming even more relevant.

Author: Mr.Amadou N Sy
Publisher: International Monetary Fund
ISBN: 1484385667
Category : Business & Economics
Languages : en
Pages : 61

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Book Description
FinTech is a major force shaping the structure of the financial industry in sub-Saharan Africa. New technologies are being developed and implemented in sub-Saharan Africa with the potential to change the competitive landscape in the financial industry. While it raises concerns on the emergence of vulnerabilities, FinTech challenges traditional structures and creates efficiency gains by opening up the financial services value chain. Today, FinTech is emerging as a technological enabler in the region, improving financial inclusion and serving as a catalyst for the emergence of innovations in other sectors, such as agriculture and infrastructure.

Author: International Monetary Fund
Publisher: International Monetary Fund
ISBN: 1498321860
Category : Business & Economics
Languages : en
Pages : 73

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Book Description
The paper finds that while there are important regional and national differences, countries are broadly embracing the opportunities of fintech to boost economic growth and inclusion, while balancing risks to stability and integrity.

Author: Ms.Inutu Lukonga
Publisher: International Monetary Fund
ISBN: 1484376544
Category : Business & Economics
Languages : en
Pages : 51

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Book Description
Financial technology (fintech) is emerging as an innovative way to achieve financial inclusion and the broader objective of inclusive growth. Thus far, fintech in the MENAP and CCA remains below potential with limited impact on financial inclusion. This paper reviews the fintech landscape in the MENAP and CCA regions, identifies the constraints to the growth of fintech and its contribution to inclusive growth and considers policy options to unlock the potential.

Author: Mr.Sanjeev Gupta
Publisher: International Monetary Fund
ISBN: 1484315227
Category : Business & Economics
Languages : en
Pages : 362

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Book Description
Digitization promises to reshape fiscal policy by transforming how governments collect, process, share, and act on information. More and higher-quality information can improve not only policy design for tax and spending, but also systems for their management, including tax administration and compliance, delivery of public services, administration of social programs, public financial management, and more. Countries must chart their own paths to effectively balance the potential benefits against the risks and challenges, including institutional and capacity constraints, privacy concerns, and new avenues for fraud and evasion. Support for this book and the conference on which it is based was provided by the Bill and Melinda Gates Foundation “Click Download on the top right corner for your free copy..."

Author: El Bachir Boukherouaa
Publisher: International Monetary Fund
ISBN: 1589063953
Category : Business & Economics
Languages : en
Pages : 35

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Book Description
This paper discusses the impact of the rapid adoption of artificial intelligence (AI) and machine learning (ML) in the financial sector. It highlights the benefits these technologies bring in terms of financial deepening and efficiency, while raising concerns about its potential in widening the digital divide between advanced and developing economies. The paper advances the discussion on the impact of this technology by distilling and categorizing the unique risks that it could pose to the integrity and stability of the financial system, policy challenges, and potential regulatory approaches. The evolving nature of this technology and its application in finance means that the full extent of its strengths and weaknesses is yet to be fully understood. Given the risk of unexpected pitfalls, countries will need to strengthen prudential oversight.

Author: Lorena Rivero del Paso
Publisher: International Monetary Fund
ISBN:
Category : Business & Economics
Languages : en
Pages : 69

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Book Description
The Digital Solutions Guidelines for Public Financial Management (Guidelines) are intended to serve as a comprehensive reference material for the assessment, design, and improvement of digital initiatives in the public financial management (PFM) area. To support the digital transformation of PFM functions, the Guidelines are structured around three Pillars – Functional, IT Architectural, and Governance and Management. Each pillar comprises six principles, which are further broken down into one to four attributes to promote more efficient and transparent PFM operations while fostering innovation and managing digital risks. These Guidelines also allow a graduated approach to digital transformation of PFM through three levels of maturity for each Attribute – foundational, intermediate, and advanced – to help take into account country-specific contexts and capacities in digital transformation strategies.

Author: Chikako Baba
Publisher: INTERNATIONAL MONETARY FUND
ISBN: 9781513561165
Category : Business & Economics
Languages : en
Pages : 35

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Book Description
Europe’s high pre-existing level of financial development can partly account for the relatively smaller reach of fintech payment and lending activities compared to some other regions. But fintech activity is growing rapidly. Digital payment schemes are expanding within countries, although cross-border and pan-euro area instruments are not yet widespread, notwithstanding important enabling EU level regulation and the establishment of instant payments by the ECB. Automated lending models are developing but remain limited mainly to unsecured consumer lending. While start-ups are pursuing platform-based approaches under minimal regulation, there is a clear trend for fintech companies to acquire balance sheets and, relatedly, banking licenses as they expand. Meanwhile, competition is pushing many traditional banks to adopt fintech instruments, either in-house or by acquisition, thereby causing them to increasingly resemble balanced sheet-based fintech companies. These developments could improve the efficiency and reach of financial intermediation while also adding to profitability pressures for some banks. Although the COVID-19 pandemic could call into question the viability of platform-based lending fintechs funding models given that investors could face much higher delinquencies, it may also offer growth opportunities to those fintechs that are positioned to take advantage of the ongoing structural shift in demand toward virtual finance.

Author: Mr.Tanai Khiaonarong
Publisher: International Monetary Fund
ISBN: 1513531492
Category : Business & Economics
Languages : en
Pages : 38

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Book Description
Financial technology (Fintech) has prompted authorities to consider their potential financial stability benefits, risks, and effective regulation. Recent developments suggest that regulatory approaches and their legal foundations need to augment entity-based regulation with increasing focus on activities and risks as market structure changes. This paper draws on recent international experiences in modernizing legal and regulatory frameworks for payment services. An analytical framework based on a four-step process is proposed—(i) identifying payment activities; (ii) licensing entities and designating systems; (iii) analyzing and managing risks, and (iv) promoting legal certainty. As payment activities evolve and potential systemic risks heighten, adherence to international standards and additional regulatory requirements should be warranted.