Maja Kadievska-Vojnovik: Fintech and digital transformation "Regulating an anonymous world" Platform for discussion by Ms Maja Kadievska-Vojnovik, Vice-Governor of the National Bank of the Republic of Macedonia, at the xCEEd Conference on Fintex, Belgrade, 22-23 May 2018. * * *  FinTech Sector – General trends, current state in Macedonia, main challenges and risks and impact on central banks’ activity FinTech is one of the fastest-growing sectors in the global financial services industry nowadays with total global venture investment in FinTech companies reaching high of $ billion in 2016(KPMG, 2016).The highest number of FinTech service providers is in the payments, clearing and settlement category, followed by credit, deposit and capital-raising services (Basel Committee on the Banking Supervision Survey, 2016). Research in the area (ATKearney & EFMA, 2013) points to several factors that define readiness for digitization in the banking sector such as: 1) the capacity of banks for innovation; 2) the stage of technological development where the country is located; 3) the level of competition in the sector; 4) culture of consumption; 5) demographic structure of the population; 6) degree of concentration in the banking sector; and 7) the existing regulation, which can promote or constrain emergence of new technological solutions.
Nevertheless, none of the current initiatives to update or replace existing wholesale payment systems are considering the adoption of DLT. The ECB and the BOJ, in their role as operators of important market infrastructures services, decided to conduct in-depth experiments to determine whether specific existing functionalities of their respective payment systems could run in a DLT environment. Findings in relation to efficiency show that, with regard to the specific aspects of RTGS services tested to date, a DLTbased solution could meet the performance needs of current large value payment systems. In conclusion, this joint effort of ECB and the BOJ has produced a thorough set of results that provide reasons to be optimistic with respect to the capabilities of DLT within payment systems. It is, however, important to bear in mind that this work has been conducted in a test environment; therefore, any assumptions regarding the capacity for DLT to be used in production should not be made from this report. Both, the Bank of England (2017) and Bank of Canada (Ho, 2017)) conclude that DLT is not yet mature enough for current adoption. Yet most central banks that are considering modernizing their core payment infrastructure stress the need to make new systems inter-operable with future DLT platforms. Looking beyond the immediate horizon, many industry participants see significant potential for DLT to increase efficiency and reduce reconciliation costs in securities clearing and settlement.