A new job for Mark Carney?

THE G20 needs freshening. Established in the immediate aftermath of the financial crisis, its most effective offshoot has been the Financial stability Board.

It is now headed by Federal Reserve governor Randal K. Quarles, who replaced Mark Carney.

The past decade has been spent seeking to make finance safe, but this has been a bit like the fairground game whack-a-mole. as one problem is snuffed out, others pop up.

The woodford affair has placed a laser focus on the ‘lie’ behind funds which promise aTM-like cash withdrawals but don’t have the liquidity to do it.

an era of low interest rates shifted much of the risk to funds as investors went in search of higher yields. Now there is a new, little understood, threat on the horizon.

The highly regulated banking system is facing an enormous tech challenge. as a global financial centre, the City is at the heart of this change. and among central

banks, the Bank of England is most alert to this onslaught.

when governor Mark Carney first started to talk about this challenge, much of traditional finance could barely stifle a yawn.

Chinese-controlled disrupter ant Financial (an offshoot of Jack Ma’s alibaba) is valued at £115bn – which is more than the market capitalisation of RBs, Lloyds and Barclays put together.

among ant’s conquests is London-based worldfirst, which has 600 staff globally, uses advanced technology and has helped more than 160,000 individuals and small businesses transfer £70bn since 2004.

The biggest development in the digital financial space of late was Facebook’s launch of its own digital currency, Libra, with the support of a host of global financial partners. It is backed by a basket of the strongest tradeable currencies. That is very different from bitcoin, where the origins, supply and underlying value are obscure.

ITHas long been a suspicion that silicon Valley giants, which know no borders and are oblivious to global regulation, have been gearing up for an attack on the financial sector. The banks have seen this as a benign threat.

amazon has found an important niche in UK finance by providing credit to small companies on its Marketplace platform.

This is precisely the kind of small business client which Nationwide, santander and others have been trying to attract.

The operational effectiveness of newcomers to the fintech market, such as the millennials’

favourite bank Monzo and Goldman sachs’ online savings account Marcus, puts the systems of the established banks to shame.

Barclays ‘smart Investor’ is clunky and, when you log on, the first notice is often a warning about maintenance closure. Natwest online banking, heavily promoted by branch staff, greets you with a spinning wheel when you are seeking to insert a password. No wonder some 9pc of UK adults now have accounts with neo-banks.

New providers, such as the payment transfer outfits, are bypassing the banks and in the UK are being offered the chance to plug into the Bank of England’s central reporting system.

The G20 cannot risk a fintech free-for-all which could destroy the ability of central banks to control the money supply – it would be a gift for money laundering and other scams. The requirement is a G20backed ‘Fintech Control Board’ to monitor and set rules for the disrupters.

who is best qualified to take on this role? step forward, soon-to-step-down Bank of England governor Carney.