Fintech could tear apart global financial systems, warns IMF’s Lagarde


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Fintech could tear apart global financial systems, warns IMF’s Lagarde

On Saturday, the 8th of June 2019, over the sidelines of a meeting of G20 Finance Ministers in Fukoka, Japan, International Monetary Fund’s Managing Director, Christine Lagarde said that a growing presence of tech giants with big data and artificial intelligence could severely disrupt the world’s financial systems, tossing up sharp challenges for financial policymakers.

Besides, the IMF Chief had also added that radical development of financial technology began to access into cheap payment and settlement systems over the low-income emerging countries, where supervising of the traditional banking networks had been scarce, causing a vulnerability over the regulation of banking system.

Mentioning about mobile payments, Lagarde had been quoted saying that increased dominance of big tech titans on mobile payments could force global policymakers rethink whether they could ensure the safety of the financial settlements.

Adding that the growing dominance of Fintech (financial technology) could make existing payment systems vulnerable by putting them under control of a handful of tech giants, Lagarde said to a symposium over the sidelines of a G20 summit of Finance Ministers in Fukoka, Japan, “A significant disruption to the financial landscape is likely to come from the big tech firms, who will use their enormous customer bases and deep pockets to offer financial products based on big data and artificial intelligence”.