Ladies and gentlemen

It is a pleasure to be back at the Afore conference, which has become something of a tradition.

Thank you for inviting me.

However, this year, I would like to depart a little from tradition. We should think ‘out of the box’ because we are facing new challenges that we need to address urgently.

Climate change is already having a profound impact on our planet. It demands urgent responses from policy makers around the globe to tackle it.

New technologies are disrupting our economic and financial systems.

They bring great opportunities - but do not come without risks.

Demographic changes, and the ageing of our populations, are also among the defining challenges of our time.

Preparing Europe’s societies and economies for the impact of these transformations is a formidable challenge and it will be costly. But we must do it – there is simply no way around it.

We should also see these momentous changes as a window of opportunity. This is a good chance for Europe to strengthen its international standing.

For one thing, we can become a global standard-setter and allow our companies to be leaders in new technologies.

We should unleash the potential of the single market to offer innovative services, spread our global reach and our geopolitical clout.

Let me explain a little.

Today, you will discuss how consumers and firms can reap the benefits of the digital transformation in the financial system. This is a priority for the European Commission too.

The European financial sector must make the most of nascent digital opportunities. And we need to help them along the way.

Take Fintech start-ups. Today, they face many barriers that prevent them from exploiting the full potential of the single market – for example, different licensing procedures.

This leads to fragmentation of their activities country by country. We need to do better.

If Europe is to reap the benefits of innovations such as distributed ledger technology, artificial intelligence and cloud computing, we have to maximise the single market’s potential so that companies can scale up across borders.

This is how consumers get more choice, and access to cutting-edge digital tech, with better products and services at lower prices. This is essential if European companies are to compete with their peers in Asia and the United States.

So what does that means in terms of regulation?

In short, we need to make sure that EU rules are technology-neutral - with no barriers to innovation.

In doing so, we must strike the right balance between promoting innovation and properly managing risks to consumers and investors.

We must have a proportionate approach, by distinguishing between big players with a global footprint and small start-ups and Fintech innovators.

This is the moment for the EU to position itself globally as a leader in digital finance.

If we fail to create conditions for European Fintechs to thrive, other players will do it for us – just take Libra as an example. 

The demand is there. The question is who gets there first.

We are aware of the urgency. And we are already consulting on crypto-assets. We need a common regulatory framework across the single market to regulate these technologies in - not out.

The Commission recently presented a European data strategy that looks at how we can harness the power of data.

In finance, all the data that firms are already required to disclose should be more accessible.

I also believe that there is merit in thinking about extending the approach we took in the Payment Services Directive, or PSD2, to other sectors. From open banking to open finance.

This should promote innovative data-driven financial services, increase consumer choice, reduce costs and stimulate competition.

By leading the way, Europe will determine the direction of travel. In doing this, we would need to respect the principle of “same risk, same rules” and watch for possible competition issues with BigTech companies.

We also need to contend with other risks, such as those stemming from weakness in our infrastructure, which market players will use – today and in the future.

A recent European Systemic Risk Board report shows that a cyber incident could evolve into a systemic cyber crisis that threatens financial stability.

Once hybrid warfare is part of the game, these risks take on more dramatic dimensions

These type of attacks were tested on a large scale against Estonian banks back in 2007.

All EU financial firms must take this seriously.

So we are currently consulting on a common framework for digital operational resilience.

I intend to put forward legislation on this later this year.

But we should also see the big picture: we need a broader vision of digital finance.

We are already speaking to stakeholders directly, with outreach events taking place in many EU countries, plus another consultation that we will launch soon.

In brief, we plan to:

- remove fragmentation in the single market for digital financial services;

- promote a well-regulated and data-driven financial sector;

- make EU financial services legislation more innovation-friendly;

- strengthen the digital operational resilience of the financial system.

Earlier, I spoke about the opportunities that transitions bring.

For certain strategic technologies – such as payments – it is the capacity to drive cutting-edge innovation with European solutions.

Our aim should be to create an innovative, integrated and competitive retail payments sector in Europe: one that can be used globally.

Later this year, we will present a strategy for an integrated EU payments market.

One important area for our strategy will be instant payments. Here, we need European solutions.

Currently, even the strongest European operators have to team up with larger international operators that are not European if they want to offer pan-European payments.

And we want to change this.

And we are looking with interest at all options, especially the several initiatives taken by industry over the past months to create pan-European payment solutions.

We welcome the ECB’s continuous support for developing these initiatives.

Payments matter because they are also a way to boost the international role of the euro.

We can do this by facilitating euro instant payments between the EU and the many parts of the world that use instant payments technology.


Ladies and gentlemen

A couple of weeks ago, the Commission set out our ambition. We want to shape Europe’s digital future, and lead the digital transformation.

In finance, we also need to get there.

I want to build on Europe’s world class cross-border payments system.

I am listening to many successful Fintech companies to understand how we can further leverage on their potential. And I rely on the innovative spirit of many of Europe’s financial firms.

Together we should work to empower European investors and consumers.

And use digital technologies to support integration of our markets, build a Capital Markets Union, and support a strong international role of Europe and the euro.

Thank you.