Macroprudential authorities should coordinate their actions in order to mitigate these risks and seek ways to balance the protection of customers' interests and financial institution risks with specific policy objectives, a level-playing field being one of them. The initiatives taken by the European Commission, such as the digital finance package, that captures – among others - the proposal for digital operational resilience act (DORA6), and the revision of the second Payment Services Directive, are steps towards mitigating the identified risks. 3/4  BIS - Central bankers' speeches  The increasing number of Cyber-attacks in Europe indicates that a lot more needs to be done. The growth of the Fintech sector has raised the need for regulators to adjust their role within the perimeter of prudential regulation. Extending the perimeter of bank regulation to all financial service providers could possibly constrain financial innovation. But keeping the new entrants completely out of the perimeter will tilt the playing field in their favour and leave consumers unprotected. A balance must be found to allow the regulatory perimeter to cover all activities that have systemic risk potential, while allowing for innovation. Finally, Data protection is important in order to safeguard confidence in the banking sector. As a result, Cyber security should be further enhanced and prioritised and Cyber-risk incidents need to be included in financial institutions' business continuity and disaster recovery plans and be tested frequently. Given the cross-border activities of Fintech and BigTech, authorities across jurisdictions should cooperate in regulating them. THANK YOU.

Fintech institutions operate on a very different business model compared to traditional banks and as such, they have a competitive advantage in terms of cost structure and overheads. Their cost advantage and speed of operational and business decision making is evident by their rapid expansion and their proven ability to grow their user base quickly. However, although Fintech bring obvious benefits to users, up until recently we haven't seen large defections of customers from traditional banks to these new players. The confidence to the incumbent banking structure together with the value that people place on their existing bank relationships provide the opportunity for an adjustment period for incumbents. Having said that, generational differences matter. Consumers aged 25 to 40, also known as generation Y, have had the biggest effect on digitization of financial services2. Generation Y account for almost 50% of mobile banking users. Based on this trend, banks can expect Generation Z (ages up to 24 years) to be even more engaged in digital banking and technology driven solutions. In contrast, generation X, the baby boomers, still see value in live communication and visiting physical bank branches. These younger consumers look for alternative ways of processing their financial transactions that are simpler and faster. The banking system needs to adapt. Incumbent banks that work with dated technologies and overextended branch networks are likely to lose their competitive edge. Technological innovation is the way to increase efficiency as a result of new competitors entering the market and new generations being more reliant on technology.