dna as regulators to think about what could go wrong. for today ’ s keynote address, allow me to therefore highlight the key challenges and risks that may lie ahead. i will then share a few perspectives that i believe are crucial for the regulatory agenda for payments going forward. the first key challenge is the evolving landscape of technologies and the resultant risks for payment systems. the rapid development and adoption of technology in recent years has brought about greater efficiency and productivity. however, the pace of change itself can be a key challenge, if not managed well. not too long ago, the advent of the internet heralded a new era for payments by enabling transactions to be conducted remotely using online banking services and payment cards. today, payment technologies have evolved rapidly to include an alphabet soup of different modes of payment – for example rfid, nfc and qr just to name a few. at the same time, new use cases leveraging on biometrics, open api, artificial intelligence and blockchain are also being developed. while such technological innovations demonstrate great potential, the full impact and resultant risk may yet to be fully understood. cyber security is also a fast - growing area of concern, given the sophistication of cyber threat actors and as more consumers and businesses are plugged into digital payments. this is further 1 / 6 bis central bankers'speeches compounded by the interconnectedness of payment systems which heightens contagion risk. while sources of risks are borderless, the non extra - territorial nature of most payment regulation and supervision presents a key challenge to effective regulatory oversight. concentration risks also require close attention, given the largely centralised model of prevalent payment systems. network effects are a double - edged sword. as a payment system becomes more widely used, the implications of operational disruption would also be more far - reaching. in 2018, we have seen two global card networks face service disruptions, affecting at least five million transactions in europe and the us. if the frequency and magnitude of such disruptions increase, there is a real risk that public confidence in digital payments would be undermined. the second challenge is market fragmentation. across domestic markets, incumbent banks, technology companies and telco firms – among others – are all vying for a share of the pie, leading to a proliferation of payment service providers. although a more diversified market can reduce some of the concentration risks that i highlighted earlier, there are trade - offs that need to be managed. in 2018 alone, the uk saw its number

efforts are intrinsically more complex, they can accommodate a richer spectrum of business structures and operating models, which in turn can spur innovation. importantly, this is not about regulations adopting a ‘ light touch ’ ; it is about having the right touch, guided by the degree of risks involved. we also should not shy away from exploring nascent technologies that could contribute to the overall resilience of payments infrastructure. as regulators, we should explore pilot programmes to test the potential of emerging technologies. examples of this include the eu and japan ’ s joint project ‘ stella ’, as well as canada ’ s project ‘ jasper ’ that aim to study the possible use cases of distributed ledger technology. even if these programmes do not immediately deliver scalable solutions, the experience can confer valuable lessons for future initiatives. enabling connectivity the third area for regulatory focus would be to enable connectivity. a payment system is only useful if it has a wide network reach, be it across products or players, within a nation ’ s borders or beyond. in this regard, regulators can play a key role in fostering collaborative efforts towards greater standardisation and interoperability. at the domestic level, a few initiatives come to mind – all of which seeking to leverage on a common network. the uk is undergoing a consolidation of key retail payment systems under a single new payments architecture ( npa ), aimed at addressing the lack of a common entry point for access and different on - boarding processes for participants across the different systems. similarly, australia launched the new payment platform earlier this year, which is seen as a key payments infrastructure for the domestic market. of significance, these developments share common outcomes – to avoid duplication of industry resources, widen network reach and enable economies of scale. here in malaysia, pooling of resources at the infrastructure level has been a longstanding strategy for the payment system. as early as 1997, malaysia had consolidated its three atm networks to eliminate fragmentation in that segment. more recently, we saw the formation of paynet which serves as a shared payment infrastructure to facilitate domestic payments. of note, paynet will be launching the real - time retail payments platform ( rpp ) next week. this will be supported by a national addressing database ( nad ) that enables users to pay seamlessly and securely using simple identifiers such as their mobile phone, national registration 4 / 6 bis central bankers'speeches or business registration numbers. at the international level, regulators should also seek to collaborate towards promoting greater harmonisation or centralisation