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Development of Fintech and Regulatory Environment

The development of financial technology (fintech) is designed to enhance the competitiveness of the financial sector, but is accompanied by potential risks that give rise to new regulatory challenges.

To enhance members’ understanding of Taiwan’s fintech development strategies, AmCham Taipei’s Asset Management, Banking, Capital Markets and Insurance Committees jointly invited Wellington L. Koo, Chairman of the Financial Supervisory Commission, to explain the government’s policy measures and their relation to global regulatory trends. Nearly 100 Chamber members and guests gathered to attend the event at The Regent Taipei on April 20.

In a presentation delivered in Chinese, Koo provided an overview of the current status of Taiwan’s financial sector and noted that regulators and supervisors around the world are promoting the growth of fintech while seeking to ensure the safety and soundness of the financial system.

Chairman Koo cited the tasks facing regulators around the world as they respond to the fintech revolution:

  • Providing interactive supervision and responding to the changes in technology
  • Encouraging the development of fintech innovation
  • Fostering new fintech startups by offering training and resources
  • Developing consistent standards and assisting new ventures in transnational development
  • Implementing regulatory technology to provide real-time monitoring of financial operators’ operating activities
  • Combining non-governmental forces to build a comprehensive information sharing and security system

Speaker Wellington L. Koo, Chairman of the Financial Supervisory Commission; William Foreman, AmCham Taipei President; Leo Seewald, AmCham Taipei Standing Vice Chairman; and AmCham Taipei Committee Co-Chairs

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Note: AmCham events are intended primarily for AmCham members and their guests. Many events are open to members’ guests and other non-members, but the attendance of any non-member must be approved in advance. AmCham reserves the right not to admit a non-member to any event without explanation.

Insurance Committee Presentation Focuses on Fintech

According to the World Economic Forum, the growing use of financial technology (fintech) is expected to bring disruptive innovation to the world of finance, increasing efficiency and lowering the costs of financial services. Fintech is already the focus of serious attention in many countries, and Taiwan is no exception.

At a luncheon meeting organized by AmCham Taipei’s Insurance Committee at The Sherwood Taipei on December 14, Jennifer Wang, Vice President and the Distinguished Chair Professor of National Cheng-Chi University, gave attendees an update on current developments in fintech in Taiwan. Since introducing the relevant regulations early this year, the Taiwanese government has been encouraging enterprises, both financial institutions and start-ups in various industries, to participate in this new field. Having more companies involved in the current experimental stage for fintech in Taiwan is seen as enabling the authorities to refine the regulations to make them as effective as possible.

From left to right: AmCham Taipei President Andrea Wu; Speaker Professor Jennifer Wang; AmCham Taipei Insurance Committee co-chairs Dan Ting, Chairman of Hotai Insurance and Linda Tsou from Cigna Taiwan Life Assurance.

Wang, a former Vice Chairman of the Financial Supervisory Commission, said fintech offers hope of bringing the following benefits:

  • Lowering the costs of financial services
  • Collecting big data and financial information to analyze
  • Providing customized financial services based on the collected data
  • Enhancing supervision of the financial sector and preventing financial crimes

Joint Committee Luncheon: The Future of Financial Progress and FSC Policy

Addressing the current state of the financial industry and the policy path forward, Financial Supervisory Commission (FSC) vice chairman Cheng-Mount Cheng told a recent AmCham Taipei luncheon audience that the FSC over the past year has taken positive steps to build a better business environment and stimulate financial product innovation in Taiwan.

The presentation, entitled “The Overview of Financial Industry Development and The FSC’s Main Policy,” was delivered at the Regent Taipei on June 16 at a meeting co-sponsored by the Chamber’s Asset Management, Banking, Capital Markets, and Insurance Committees.

Speaker Cheng, Cheng-Mount 鄭貞茂, Vice Chairman at Financial Supervisory Commission 金融監督管理委員會副主委, Andrea Wu, AmCham President, and AmCham Taipei Committee Co-Chairs

Cheng devoted much of his talk to the FSC’s proposed programs for financial technology (“fintech”) innovation. He said that responding to concerns voiced by several fintech companies, the FSC has prioritized implementation of a “regulatory sandbox” – an encouraging space for technological innovation, free of most existing regulatory constraints. Such a mechanism would enable both financial institutions and fintech developers to test new products and services for a trial period of up to 18 months.

Cheng affirmed that fintech is a top priority for the FSC, but that the Legislative Yuan needs to pass authorizing legislation before the regulatory sandbox mechanisms can go into effect.

The Vice Chairman identified the FSC’s main policies as:

  • Promote fintech
  • Develop green finance
  • Support the New Southbound Policy
  • Promote measures for the aged society
  • Expand the scale of the capital market
  • Promote financial inclusion measures
  • Strengthen prevention of money laundering
  • Protect consumers’ rights and interests

Cheng said that these policy priorities are opportunities to bring Taiwan’s financial industry in line with international standards, and even enable Taiwan to become a global leader of financial innovation. “I believe with tech advancing very fast every day, we will see results,” he observed.

While optimistic about the financial industry’s future, Cheng is nonetheless very aware of the FSC’s jurisdictional limitations in shaping that vision. “Many people know that the FSC is in charge of financial markets, but they don’t understand that our capability is quite limited,” he noted.

In a comment for the AmCham Taipei blog, Christine Jih, co-chair of the Asset Management Committee and Chairman & CEO of BNP Paribas Investment Partners Taiwan, said: “Increasing interdepartmental coordination is key to streamlining regulation and strengthening Taiwan’s financial industry. The Vice Chair has been very modest but we all know he has done a lot for the industry. Mr. Cheng is very open-minded and keen to improve this system. This is an industry facing new challenges and new issues every day, and government departments need to talk to each other to keep up with these advancements.”

Interested in attending our events? Join us at other upcoming events, click here.

Note: AmCham events are intended primarily for AmCham members and their guests. Many events are open to members’ guests and other non-members, but the attendance of any non-member must be approved in advance. AmCham reserves the right not to admit a non-member to any event without explanation.

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