Here Are the Key Findings From OneSpan’s Global Financial Regulations Reportby Michael Magrath, Director, Global Standards & Regulations, OneSpan December 22, 2021 0 comments
OneSpan recently released its second annual Global Financial Regulations Report, that outlines major developments in the regulatory landscape.
In conjunction with comprehensive research into how the changing regulatory landscape is impacting the banking community, this year’s report also reveals how financial institutions are responding to new challenges presented by increasingly innovative hacking attacks, protecting sensitive data and evermore stringent regulations.
48% of financial institutions report that regulatory compliance has slowed digital transformation.
Despite the major security and regulatory challenges institutions were faced with in 2021, 84% of banking leaders are taking steps to prepare for cutting-edge initiatives like Central Bank Digital Currencies (CBDCs) over the coming year.
In addition, half of banks are planning to implement mobile app shielding technologies to secure mobile apps in anticipation of upcoming CBDC initiatives.
Other key findings from the report:
- Top compliance challenges for banks include: reducing or preventing cyber-attacks (53%); safeguarding sensitive data (47%), keeping pace with changes in consumer privacy laws and industry regulations (41%).
- Almost half of banks are putting digital remote identity verification and biometrics in place to comply with industry regulations.
- Bank leaders are generally optimistic about crypto regulations. 67% of financial services leaders agree that crypto regulations make banks’ participation in the market more attractive.
Asia Pacific’s fintech landscape
Diverse and vibrant Asia Pacific is emerging as the world’s most exciting region for fintech.
Regulators, financial institutions and fintechs are intent on cultivating digital talent and developing innovative solutions like artificial intelligence.
Steep competition between jurisdictions—especially in the shadow of a digital powerhouse like China—will ensure that growth in fintech continues to accelerate.
Wealthy and established economies like Australia, Hong Kong, South Korea and Taiwan are pursuing ambitious digital plans.
Taiwan, Asia’s top economic performer of 2020 and one of the world’s most competitive economies, will be a key market to watch.
Its regulators have sought to lower entry barriers for fintechs, strengthen cybersecurity and data protection frameworks, and promote the development of disruptive technologies.
Hong Kong is similarly aiming to cement its status as a global financial center.
In June 2021, the Hong Kong Monetary Authority (HKMA) announced its Fintech 2025 strategy, which aims to modernise data infrastructure, promote the uptake of fintech by the financial sector, set the stage for the advent of CBDCs and provide more financial and regulatory support for the development of fintech.
Meanwhile, emerging markets like India and Southeast Asia are experiencing incredible digitalisation, though structural challenges and the continued effects of the pandemic could stall progress in economic transformation.
India’s fast-growing fintech market is currently valued at US$ 31 billion, and is forecast to expand by a staggering US$ 84 billion by 2025.
Its young and tech-savvy population is leading a surge in digital payments, and India’s United Payments Interface (UPI) recorded 3.55 billion transactions in August—an all-time high.
Australia, Hong Kong, India, Japan, Malaysia, New Zealand, Taiwan and Thailand are all exploring CBDCs, which will both promote financial inclusion and interregional and international trade.
In addition to the research, the second annual Global Financial Regulations Report outlines major developments in the regulatory landscape in 54 jurisdictions worldwide.
The report delves into country-by-country analysis of CBDCs, open banking, artificial intelligence, digital identity frameworks, e-signatures and remote online notarisation, and data privacy.
OneSpan’s Global Financial Regulations Report can be accessed here.