Digital payments are becoming more widespread, propelled by advances in near-field communications, identity authentication, digital IDs, and biometrics. Blockchains or distributed ledger systems are being tested for a wide variety of financial operations – to settle interbank payments, reconcile trade finance invoices, execute performance contracts. Big data is being used in many areas of finance - to gain richer insights into customer behaviour and needs, to detect fraud or anomalies in financial transactions, to sharpen surveillance of market trends. How should regulation respond? First, we need to develop a deep understanding of these emerging technologies and the risks as well as opportunities they present. Second, we need to develop novel approaches in regulation and supervision that will promote the safe and responsible application of these technologies without stifling innovation. In some ways, FinTech helps to reduce existing risks; in other ways, they may accentuate these risks or even create new ones. Let me illustrate using robo-advisors. Robo-advisors, as you know, are software algorithms that recommend a portfolio based on a set of investor preferences and rebalance the portfolio automatically. T he financial risks presented by robo-advisers are similar to traditional fund management, depending on the underlying instruments used. A common question is whether robo-advisers present prudential risks and should therefore be subject to capital requirements. The operational risks posed by robo-advisers are more interesting. AML/CFT risks may well be reduced through transaction monitoring enhanced by big data and pattern recognition algorithms.

Frameworks are being established to identify and address the risks posed by global systemically important financial institutions. Make derivatives markets safer. Requirements are being put in place to foster central clearing, margin requirements, and mandatory reporting of OTC derivative trades. Transform shadow banking into resilient market-based finance. Oversight of shadow banking entities is being strengthened. The Financial Stability Board has been working to ensure that these internationally agreed regulatory reforms are implemented in a timely and consistent manner across the major jurisdictions. While gaps remain in some areas, implementation is generally proceeding well. It is time now to begin the important task of evaluating the impact of the reforms. In fact, the FSB is developing a conceptual framework for doing this. The framework aims to answer two questions: have the regulatory reforms been effective – are they achieving their intended outcomes? 1/7  BIS central bankers' speeches  what are the cumulative effects of the reforms – how have the various reforms interacted with one another, are they coherent, what are their larger social benefits and costs? This work is especially important in the current context: As memories of the crisis fade and the burden of regulatory reforms comes into sharper focus, the pressure to unwind the reforms will grow. It is important for the credibility of the reforms that their impact be objectively evaluated. It is also incumbent on us as regulators to be accountable for the substantial changes that we have put in place over the last eight years.