Mr Liikanen explained that today, a major push for innovation in global finance is coming from ‘big techs’, companies that are dominant platform providers that offer ubiquitous digital services. He summarised the impact of these big techs neutrally:

1. The entry of big techs into financial services holds the promise of efficiency gains and can enhance financial inclusion.
2. Regulators need to ensure a level playing field between big techs and banks, taking into account big techs’ wide customer base, access to information and business models.
3. Big techs' entry presents new and complex trade-offs between financial stability, competition and data protection.

Based on this, Mr Liikanen offered three observations. Firstly, policymakers need to decide how much to encourage big tech to enter finance — should policies promote big techs’ entry or restrict it? Secondly, big tech tests the regulatory perimeters of data protection, competition policy and now financial regulation. As such, regulation that is fit-for-purpose will require enhanced cooperation among multiple regulatory bodies. And thirdly, we need to recognise the cross-border nature of the big techs and fintechs challenge and respond appropriately. Mr Liikanen also noted that among the initiatives in the field is the work by the IFRS Foundation to consider the accounting for crypto assets under IFRSs.

Mr Liikanen closed his speech by noting: "Innovation is here to stay, and it will bring benefits and it will bring challenges. We need a balanced approach, where we reap the benefits of financial inclusion and efficiency and ensure a level playing field between big techs and banks."

Please click to access the full text of Mr Liikanen's speech on the IASB website.