25.09.2020  How central banks can use digitalisation to better serve the public: the case of payments Navigating the Digitalisation Transformation - Virtual OMFIF-Banque de France Seminar Pablo Hernández de Cos Governor  Good morning, I would like to start off by expressing my gratitude to both the OMFIF and the Banque de France for organising this very interesting and, certainly, timely event. Like many of my esteemed colleagues, I have been vocal about the growing relevance of emerging technologies for the financial system before. In fact, at the Banco de España we are closely monitoring trends in order to fully understand their potential implications and be ready to act quickly, where necessary. Yet despite all its recent history and significance, it is now -in the light of the pandemic- that digitalisation has become even more critical and, possibly, also a catalyst for a tectonic shift across multiple dimensions. Products, services, business models, distribution channels and touch points all over the industry may, indeed, be closer today to an accelerated reshaping than was the case only a few months ago. If anything, these difficult times have, in my view, proven what a valuable ally digitalisation can be to strengthen banks’ resilience and secure the necessary flow of funds to society at large. This has been instrumental to mitigate some of the damage caused by the outbreak. More broadly, the virtualisation of our economic activity during the pandemic has further provided a necessary backstop for many businesses that used to rely solely on their physical presence.
After all we have heard today, I think it is safe to say that none of us disputes the idea that digital technologies are at the very heart of all serious present-day attempts to achieve any kind of sustainable, cutting-edge innovation. Moreover, in the aftermath of COVID-19, it is fair to expect that the financial services industry will have no choice but to continue to navigate the unchartered waters of digital transformation, on the lookout for a safe harbour that will provide shelter and, hopefully, a gateway to a booming market place. As central bankers with a clear public policy agenda and mandate, we cannot refrain from meeting our obligations in this context. Consequently, as the need for a major makeover becomes more pressing, I believe that financial authorities should take a proactive stance towards digital innovation. We should do so by striking the right balance between responsible parties, assignments and the necessary guardrails whilst ensuring optimal provision of what the BIS General Manager Agustín Carstens likes to call “central bank public goods”. For this reason, central banks must try to stay ahead of the curve and be ready to embrace experimentation and research on these topics as soon as possible, while building bridges with all the relevant stakeholders and closely scrutinising the progress that their initiatives achieve in related fields. Only this strategy will pay dividends in the long run and pave the way for a future that best serves the needs and maximises the welfare of our society.