Lecture on Governments and the Future of Finance

Introduction

• Session follows the previous one, addressing unanswered questions.
• Focus: Governments & future of finance.
• Public finance authorities transforming operations using innovative technology.
• Format: Speakers give remarks, followed by Q&A.

Speakers

1. Dina: Deputy Director at Latvia's Ministry of Finance.
2. Diego: Digital Finance Coordinator at the Spanish Treasury.
3. Sandy: Head of Government & Strategic Accounts at Clear Bank.

Key Points from Dina's Remarks

• Fintech and Government Role:

  • Governments play crucial roles in fintech ecosystems.
  • Developed a fintech strategy in Latvia with private sector collaboration.
  • Importance of traditional financial institutions and fintech's innovative solutions.

• Strategy Elements:

  • Development of talent.
  • Excellence in regulation.
  • State support and public awareness.
  • High digitalization in finance (87% digital payments).
  • Government services increasingly digital.

• Digital Identity:

  • Essential for accessing digital services.

• Challenges and Focus:

  • Need for collaboration with universities for education.
  • Importance of investment in human capital.
  • Role of fintech in public procurement and AI regulation.

Key Points from Diego's Remarks

• Government and Technology:

  • Governments should leverage technology for efficient public services.
  • Highlighted areas: policy work, algorithmic state, cybersecurity, etc.

• Economic Analysis and Big Data:

  • Benefits of microdata and machine learning for policy evaluation.

• Algorithmic State:

  • Algorithms used for subsidies, need for unbiased data to avoid inequalities.

• Public Financing and DLT:

  • Use of DLT in public debt issuance for efficiency.

• Cybersecurity:

  • Critical for the digital economy.

• Supervision Tech (SupTech):

  • Potential use in anticipating financial issues without overregulation.

Key Points from Sandy's Remarks

• Clear Bank Overview:

  • Not a fintech, but a regtech (regulated bank using technology).
  • Provides innovative banking solutions without legacy system constraints.

• Technology and Innovation:

  • Cloud-native solutions, direct connectivity to payment schemes.
  • Expansion plans in Europe and the US.

• Government Collaboration:

  • Supports government with payment solutions (e.g., PayPoint).
  • Advocates for transformation, not just digitization.

Discussion Points

• Innovation and Transformation:

  • Public sector must lead in transformation to remain relevant.

• AI in Public Sector:

  • Benefits and risks (e.g., bias, job displacement).
  • Need for education and awareness in AI applications.

• Challenges in Technology Adoption:

  • Cost, skills, and procurement issues.
  • Importance of human capital and avoiding full dependency on private actors.

Audience Interaction

• Questions about AI's impact on jobs and biases.
• Discussions on procurement challenges in Europe for fintech companies.