‘Ensuring financial stability essential in turbulent times’
Governor of the Central Bank of Kuwait (CBK) Dr Mohammad Al-Hashel stressed yesterday the importance of ensuring financial stability in turbulent times. Maintaining stability in money world is attained through shedding light on two effective factors; the tech-driven revolution, which has brought its own set of risks and rewards, and the wide range of measures that have been introduced to strengthen the resilience of the banking systems, Hashel said.
He made his remarks in his speech at the 12th High Level Meeting for the Middle East and North Africa region on latest updates on banking supervision, financial stability institute, and the Arab monetary fund, which kicked off earlier in the Emirati capital.
“Tech-driven innovations have unleashed drastic changes in the way we conduct business, interact with each other, or consume various products and services,” Hashel said, adding that financial sector is experiencing a major transformation, fueled by advances in technology.
“Technology is supporting the outreach of formal financial services to the millions of otherwise unbanked customers. According to World Bank, the poorest 20 percent of the world population is more likely to have access to a mobile phone than to clean water and sanitation,” he said.
Hashel also noted that a number of countries have managed to swiftly expand access to finance in recent years, adding that the number of adults in the world who were previously out of formal financial system has dropped by 20 percent during 2011-14 alone. “As these encouraging trends suggest, digitalization to the millions of people have remained financially excluded so far,” he said.
Hashel also noted that programing breakthroughs such as “blockchain” are potentially transforming the way the world verify transactions and enforce contracts, adding that that by allowing parties to transact without central intermediaries, blockchain can strip off costs, reduce inefficiencies, and enhance customer service.
“Host of other innovations are reshaping the way we transfer money or obtain credit. For instance, mobile wallets are enabling payments by smart phones, peer-to-peer lending is providing new sources of financing, and robo-advisors are offering financial advice,” he said. —KUNA