Asia
Regulating fintech is biggest tech challenge, central banks say
Benefits include financial inclusion, cost reduction and service efficiency
Central banks split on machine learning, AI technologies
Respondents optimise features despite drags in data quality, skills gap and algorithmic challenges
Location, security and privacy are top cloud concerns
Richer economies more likely to domesticate and operate hybrid servers
Cloud used for business continuity and advancing computation
Most institutions rely on third parties for services
Retail CBDC work more common than wholesale
Most jurisdictions still lack a legal mandate to issue a CBDC
Central banks are bullish on environmental features of CBDC
A minority of respondents’ jurisdictions prohibit crypto assets
Improving payments efficiency drives wholesale CBDC work
Advanced economy institutions lead efforts
Richer nations more likely to have regtech strategy
Regtech tools commonly used for risk assessment
BoT’s Sethaput on inflation dynamics, central bank mandates and multi-lateral payments
Thai governor speaks about higher inflation, sustainable finance challenges, CBDC experiments and payments governance
Laotian central bank launches CBDC pilot
Bank of the Lao PDR working with Japanese government and fintech firm to test CBDC
Innovation hubs more common in advanced economies
Sandboxes remain most popular fintech initiative
Two in five central banks report having a suptech strategy
Enhancing efficiency is a key driver
EME central banks more likely to license fintech firms
Most institutions choose activity-based approach over other licensing methods
Payment innovation is top priority for fintech research
CBDCs and suptech are also leading focus areas for development
Half of central bank respondents have a fintech strategy
Most strategies cover the external payments ecosystem and internal fintech development
Over four-fifths of banks have yet to update APP risk mitigants
Most emerging market institutions plan to improve climate provisions in near future
Financial risk teams have higher staffing ratio than other units
Cyber risk and other threats prompt greater staff allocation to sub-units
Financial risks report published across 75% of jurisdictions
Frequency of publications and levels of transparency vary across jurisdictions
Centralised departments more likely to face new responsibilities
Respondents reported changes in risk approaches to the environment, and banking and insurance supervision
Risk management staff earn many multiples of per capita income
Risk managers paid more in richest jurisdictions but poorer countries still pay competitive wages
Use of defined project risk and delegated risk metrics declines
Around three-quarters of central banks have distinct institutional risk appetite
Why central banks shouldn’t ignore stablecoins
Rapid growth of stablecoins could impair monetary policy transmission
ISO 31000 remains top framework for risk managers
Majority of banks blend international frameworks with domestic solutions
Most central banks still not using GRC systems
AE respondents more likely to favour integrated system versus EME counterparties, in a reverse to 2022