ERFF: European Retail Financial Forum
RFS Spotlight February 2018
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Monthly EU Retail Financial Services update
Since its launch in October 2015, ERFF has been working with representatives of business, consumers, and EU policymakers to create consensus on value-added ways to open up EU retail financial services (RFS) markets. ERFF’s RFS Spotlight brings you news on EU RFS policy, events, and creating benefits for customers and industry.
EC FinTech Action Plan coming soon
The much-awaited European Commission (EC) Action Plan on FinTech is due to be published in early March, probably on the 7th. FinTech cuts across a huge range of issues: the Digital Single Market, eIDAS, cybersecurity, PSD2, AML, CMU, MiFiD, GDPR, and developments in DLT, AI, cloud computing... As a result, many aspects already fall under EU regulation. So from what we understand, the Action Plan won’t contain any major regulatory proposals.
However it’s likely that the Commission will promote increased harmonisation of licensing and supervisory regimes to make it easier for newcomers and incumbents to offer FinTech-based services across Europe. And we expect moves to support national supervisors in sharing knowledge EU-wide and in creating favourable conditions for innovation – with a clear eye on consumer safeguards as well. Given the focus on harmonisation and market access, interoperability, standards and facilitating the use of cloud services are also good bets to feature in the plan.
We expect some concrete proposals on crowdfunding and peer-to-peer lending since responses to the EC’s FinTech consultation raised numerous concerns about a lack of regulation in these areas. On technologies such as Digital Ledger Technologies (DLT), Artificial Intelligence (AI) and cryptocurrencies, it seems likely the EC will continue to study and monitor rather than act, at least in the short-term. There may be more substance on a strategy towards blockchain (DLT) and Financial Transparency. The EU has already launched its Blockchain Observatory and Forum, see below. And, of course, cyber security is certain to be covered as banks and their customers are prime targets for cyber attacks.
Many of these topics were discussed at ERFF's technical workshop on the Future of Retail Financial Services and FinTech on 24th January 2018. Hosted by Sven Giegold MEP (Group of the Greens/European Free Alliance), among the speakers were: Peter Kerstens, co-chair of the EC FinTech Task Force; Ralf Jacob, DG FISMA; Isabelle Buscke of the Federation of German Consumer Organisations and Mirel ter Braak of the Dutch Financial Markets Authority.
Meanwhile…
Sustainable Finance has been in the spotlight over the last few weeks, with a flurry of events triggered by delivery of the final report from the High-Level Expert Group (HLEG) on 31 January. Its strategic recommendations “for a financial system that supports sustainable investments” include: establishing a taxonomy to define “sustainable investments”; making sustainability part of the European Supervisory Authorities’ (ESAs) mandates; and overall greater transparency including help for retail investors to find suitable products, such as an EU-wide label for green investments. A high-level conference on the report will take place in Brussels on 22 March (invitation-only) to coincide with publication of the EC’s Action Plan on this topic.
In response to the HLEG report, the Parliament’s ECON Committee published a draft Own-Initiative report on Sustainable Finance (rapporteur MEP Molly Scot Cato, Group of the Greens/European Free Alliance) in early February. The draft text encourages the EU to show leadership in this field, particularly in expanding the scope of sustainable finance beyond purely the risks to financial stability from ‘stranded assets’ related to climate change. MEP Sven Giegold has encouraged the Commission to take up the draft report’s ideas, saying: “… the European financial system can become more crisis-proof and at the same time serve the transition to a more ecological and social economy.”
Some consumer organisations have greeted certain aspects of the report with reservations. Elsewhere, the wider discussion on sustainable finance is being taken up at various events, including the EBF Money Week (starting 12 March).
Also in early February, the EU’s Blockchain Observatory and Forum was officially launched with a mission to monitor developments, pool expertise across sectors, and explore use-cases and the technology’s potential for a range of industries. Blockchain company, ConsenSys, will support EU outreach in this project, and the first technology pilot is up and running. Known as the European Financial Transparency Gateway (EFTG), it uses DLT to provide access to information on companies listed on EU securities regulated markets.
Coming up…
27 March 2018, ERFF Technical Workshop on Cross-border access to Consumer Credit & Creditworthiness Assessments – hosted by MEP Josef Weidenholzer, rapporteur for the IMCO Committee on the EC’s Action Plan on Consumer Retail Financial Services.
This is an opportunity for consumer and business organisations to engage with policy makers and supervisors in a roundtable discussion on these important topics in the EC’s RFS Action Plan. Confirmed speakers: Renatas Mazeika, Head of Unit, DG JUST, European Commission; Olivier Jerusalmy, Senior Research & Advocacy Adviser, Finance Watch; Enrique Velazquez, Director-General, ACCIS; Nadia Hazeveld, Legal Adviser, Eurofinas.
If you would like to know more about this workshop, please contact us at info@erff.eu.
About ERFF
The European Retail Financial Forum (ERFF) brings together around one table consumers, business and policymakers to support the opening up of retail financial markets in Europe. Representing all aspects of the retail sector – traditional, wider investment and digital – we are customer-focused, favour removing key barriers, and increasing choice and transparency for all in ways that keep Europe competitive.
For further information, please contact us at: info@erff.eu
ERFF Secretariat
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