OECD's Paper On Digital Disruption In Banking And Its Impact On Competition

I. Introduction

OECD's newly-published paper titled "Digital Disruption in Banking and its Impact on Competition"¹ analyses the possible strategies of the players involved—incumbents, FinTech and BigTech firms—and the role of regulation. In its paper, OECD states that the industry is facing radical transformation and restructuring, as well as a move toward a customer-centric platform-based model. According to OECD, competition will increase as new players enter the industry, but the long-term impact is more open, and regulation shall decisively influence to what extent BigTech shall enter the industry and who shall be the dominant players. Pursuant to OECD's view, the challenge for regulators will be to keep a level playing field that strikes the right balance between fostering innovation and preserving financial stability where the consumer protection concerns rise to the forefront.