Consumer Risks in Fintech : New Manifestations of Consumer Risks and Emerging Regulatory Approaches
Fintech is increasingly recognized as a key enabler for financial sectors worldwide, enabling more efficient and competitive financial markets while expanding access to finance for traditionally underserved consumers. A critical challenge for polic...
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| Language: | English |
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World Bank, Washington, DC
2021
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| Online Access: | http://documents.worldbank.org/curated/en/515771621921739154/Consumer-Risks-in-Fintech-New-Manifestations-of-Consumer-Risks-and-Emerging-Regulatory-Approaches-Policy-Research-Paper http://hdl.handle.net/10986/35699 |
| Summary: | Fintech is increasingly recognized as a
key enabler for financial sectors worldwide, enabling more
efficient and competitive financial markets while expanding
access to finance for traditionally underserved consumers. A
critical challenge for policy makers is to harness the
benefits and opportunities of fintech while managing its
risks, including for consumers. The COVID-19 pandemic
further accelerated the widespread transition of consumers
to fintech and digital financial services, highlighting
their significant benefits while also demonstrating how
risks to consumers can increase in times of crisis and
economic stress. This paper (1) identifies a range of
consumer risks posed by fintech, focusing on four key
fintech products (digital microcredit, peer-to-peer lending,
investment-based crowdfunding, and e-money) and (2)
discusses consumer protection regulatory approaches emerging
internationally for policy makers to consider when
developing regulatory policy to target such risks. Examples
of regulatory approaches are drawn from country examples and
international literature. The paper also discusses a range
of implementation considerations. |
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