The Bank for International Settlements is to set up a network of Innovation Hubs in major financial locations as central banks grapple with the policy implications of new technology.
The BIS says the role of the Hub will to foster international collaboration on innovative financial technology, identifying and developing in-depth insights into emerging trends and running experiments in the application of technology to enhance financial regulation.
Jens Weidmann, chairman of the BIS board, says: "The IT revolution knows no borders and therefore has repercussions in multiple locations simultaneously. The establishment of the BIS Innovation Hub will enable central banks to extend their existing collaboration with a view to identifying relevant trends in technology, supporting these developments where this is consistent with their mandate, and keeping abreast of regulatory requirements with the objective of safeguarding financial stability."
The Hub will span multiple locations, beginning in Basel and Hong Kong before moving to Singapore in the initial phase. Additional Hub Centres across the Americas and Europe will be added as part of a second phase of implementation.
Mark Carney, chair of the economic consultative committee, welcomes the move. "There is a new economy emerging driven by changes in technology, demographics and the environment. While the private sector is driving these innovations, their efforts will be more effective if the hard and soft infrastructure of the global financial system support this innovation, promote resilience and level the playing field on which to compete. Central banks have a major role to play. The BIS Innovation Hub will foster collaboration between central banks and, by extension, help the private sector to fully realise these major opportunities."