The establishment of a working group on the fintech sector is expected to be announced next Monday, Minister of State at the Department of Finance Simon Harris said yesterday, as part of the Government's effort to position Ireland as a centre for the burgeoning financial technology industry.
About 100 representatives from the German and Irish financial and technical industries attended a seminar organised by IDA Ireland and Enterprise Ireland in Frankfurt yesterday in conjunction with the Irish Embassy. It explored the challenges and opportunities presented by new technologies in financial services.
“Fintech” refers to “financial technology” – a new area which has seen technology shape traditional financial and banking services, in some cases posing a threat as IT companies compete with traditional banks in offering banking services.
The sector, highlighted in the Government's policy document for the IFSC, IFS 2020, could generate 5,000 jobs in Ireland over the next five years, according to a report by Deloitte earlier this year.
Financial innovation
Addressing delegates in Frankfurt, Mr Harris said Ireland aimed to be at the cutting edge of financial sector innovation, including in the fintech sector over the coming years, but this required investment in research and innovation.
“This is about imagining how new technologies might be applied to the customers’ demands of tomorrow. Companies that fail to innovate will quickly find themselves struggling to keep up in a highly competitive industry,” he said, adding that Ireland benefited from a strong presence of both financial and ICT companies.
Addressing the regulatory challenges presented by new technology in the financial services sphere, Gareth Murphy, director of markets supervision at the Central Bank of Ireland, said technological changes provided significant resourcing challenges for regulatory authorities. "Technology is changing the way economies work. It is also changing the risks that financial authorities face."
He cited cybersecurity as a focus for the Central Bank of Ireland given the increased incidence of attacks on personal and corporate IT systems globally. “It is essential for central banks and regulators to gear up in the face of this change.”
One of the main challenges for central banks was attracting the talent needed to ensure these changes in technology can be regulated, he said.
The new working group, under Enterprise Ireland, will be charged with producing a policy paper on the fintech sector.
