🚩 Risk Rising from Technology Efficiency
BIS recently published a report to warn about the risk of growing dependencies on big techs - from both financial institutions and regional techs.
Here is a brief summary.
🟦 Interdependencies of Big Techs
Infrastructure: cloud, analytics.
Partnerships: distribution, acquisition.
The interdependencies continue to grow.
Driven by the benefits of scale and breadth.
🟥 Risks - Already Part of the Reality
When one big tech fails, many go down.
Currently sectional regulation only.
Growing systemic risk.
“A policy blind spot”.
🟩 Regulators: What to Do
While working on a new framework ...
Indirect way: focus on regulated FIs
Direct way: oversight of critical providers
Specific entity-based rules (China: Ant Financial)
“Big tech interdependencies – a key policy blind spot” The full 35-page report:
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