paper no. 18315, august 2012. the financial industry has always been an early adopter of new technology. the first automatic teller machine ( atm ) in history was installed in 1967 at a branch of barclays bank in london, to allow clients to get cash outside normal working hours. since then, many automated services such as second generation atms, pos systems, debit and credit cards, online trading and online banking services 3 have been offered in response to customers ’ demand for immediacy. thus, the widespread adoption of digital technology in financial markets in recent years should not come as a surprise. the use of digital financial services is set to soar, boosted by rising customer expectation, the spread of internet, smartphones and tablets, by the steady fall in data storage cost and by the improvement in the processing capacity of computer systems, including via cloud computing. 4 the progress recorded in the last few years is astonishing : for example, the amount of data exchanged internationally is now 45 times greater than in 2005, while the cost of storing information is 10 times lower than in 2010. 5 it is against this backdrop that fintech comes into the equation. 2. fintech what do we mean exactly by fintech? the financial stability board defines it as “ technologically enabled financial innovation that could result in new business models, applications, processes or products with an associated material effect on financial markets and institutions and the provision of financial services. ” according to this definition, fintech encompasses a wide range of services and activities. an example may help clarify this. in addition to using banknotes, cheques, or internet banking, today i can use my mobile phone to transfer money to a friend. all i have to do is to download the appropriate app, type a simple text message and select my friend ’ s name from my contacts list. my friend would receive the money in a few seconds, and could even reuse it immediately for his own payments. the evolution of financial advisory services provides another example. in the past, when i needed financial advice, i contacted my advisor. in most cases he would not remember my name or my financial situation ( although in some cases he would pretend he did! ). he would ask for my atms are electronic instruments that make it possible to carry out current account operations ( cash withdrawals or deposits ) without needing a bank clerk to intervene. point of sale ( pos ) systems use electronic terminals that accept non - cash payment instruments, such

richter ( 2023 ). conference paper boissay, collard, gali, and manea ( 2023 ). conference paper bosshardt, kakhbod, and saidi ( 2023 ). conference papers hinzen ( 2023 ) and giannetti, jotikasthira, rapp, and waibel ( 2023 ). see the speech by luigi federico signorini, senior deputy governor of the bank of italy, at the 54th credit day, rome, 3 november 2022. on households, firms and output is enormous, and we therefore need to understand each and every aspect of this transformation. 9 • while initial concerns focused on how fintech companies could disrupt traditional financial institutions, evidence suggests that banks have adapted to the new technologies and some have even acquired fintech firms. still, traditional institutions should continue to innovate in the provision of financial services to guard from other challenges in this field, like those that could come from bigtech companies that can leverage on the combination of a large amount of customer data and advanced technologies. 10 • i therefore view the presentations we will hear on the uses and benefits of big data for banks as extremely timely. the papers we will discuss today give us a sense of the surplus created by such technologies for borrowers and lenders, and of the scope for technology adoption by banks. this type of research helps regulators and policymakers understand how the ongoing wave of innovations could affect the credit market structure. 11 • in turn, policymakers find themselves having to keep pace with innovation in the financial sector. during the course of the conference, we will hear about how supervisors can take advantage of similar innovations – a phenomenon known as suptech – and what results they can expect. 12 climate risk • the conference also touches upon the financial sector risks associated with climate change, one of the key policy challenges of our times. the transition to a net - zero carbon emission economy requires the introduction of financial disincentives for the use of fossil fuels and the adoption of environmentally sustainable technologies. an effective environmental policy and a sound financial sector go hand - in - hand to recent works by researchers at the bank of italy point to how digitalization was instrumental in the resilience demonstrated by the italian economy during the pandemic and how it correlates to better bank performance ( see branzoli, rainone, supino, 2024 ). the bank of italy also follows this theme closely through different initiatives aimed