On October 12, the Financial Stability Board (a G20 body that monitors and makes recommendations about the global financial system) presented a document recommending that emerging economies be able to regulate financial services provided by so-called BigTech. The report was submitted on October 14 to the G20 technical group of finance ministers and central bank presidents, but it was not discussed.
The report details market developments and the implications that financial services provided by BigTech companies have for economic stability mainly in developing economies. While recognizing that the expansion of these services has brought benefits to consumers, it clarifies that they also give rise to “risks and vulnerabilities”.
In this context, the document highlights the positive role that “strong” regulation and supervision can play in promoting innovation in the financial services sector. These regulations should come from the state sector’s public policies, as they are needed to mitigate the risks associated with these services.
The report highlights that in many developing countries, BigTech tend to dominate the local financial services market, and in many of these countries, they are the only providers of these types of services.