Regulators around the globe are very mindful of this trend and are willing to take calculated risks on innovative ventures, going beyond the banking system for solutions. There is thus, a more level-playing field and more business opportunities for non- traditional companies that are responsive and effective in meeting the financial services needs of consumers. For example, new robo-advisory businesses are now providing high quality investment advice at low cost, while payment technology companies are making cross-border payments cheaper, 1/5  BIS central bankers' speeches  quicker and more efficient. TransferWise, a cross-border payment company is now moving to offer ‘borderless’ bank accounts for businesses that operate across border. This is a challenge for many incumbents. The second observation is that data could be the ‘king-maker’ of finance. Companies that are able to control and leverage on data to deliver superior customer experience will possess the greatest advantage. Successful startups over the past decade such as AirBnb, Grab, Snapchat and Uber have all utilised technology and data to improve business models and customer interactions. For the financial sector, this could potentially mark a highly interesting shift of mantra in the future from “cash is king” to “data is king”. The arms race of the 21st century is really big data. Firms on Wall Street and the City of London are now employing data scientists en masse. They are the new breed of ‘bankers’. The bankers of the future.
The first one is more fundamental and concerns the closer degree of financial and economic integration between countries. Globalization of the world economy has been driven by a variety of forces including rising trade in goods, increased international capital flows, greater technological spillovers, and growing labor mobility. While these factors have brought about a more efficient allocation of resources across national borders and facilitated higher growth and development across countries, they have also created a world environment in which shocks have become more global in nature and where crisis in one country can easily affect others. The end product of greater international economic interdependencies, especially in financial markets, is therefore the enhancement of the underlying international business cycle linkages. Which brings me to the second aspect of the world economic environment that I would like to touch on today. This aspect concerns the immediate state of the world economy. The globalization of information technology (IT) production has meant that the correction of the unsustainable boom in IT spending has had a particularly widespread impact on the world economy. All the major industrialized countries are experiencing a synchronized slowdown in their business cycles, adversely affecting countries in the Asian region who rely heavily on exports of high-tech products. These developments have been accompanied by a steep decline in the growth in world trade. Falling commodity prices and increased competition in world markets have also put pressure on the external sector as exporters grapple with both weaker volume and lower prices.