Opening Speech at EP Event, Regulating FinTech: The Way Forward by Minister of State, Michael D’Arcy TD

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Good morning ladies and gentlemen, I’d like to thank Brian (Hayes) for inviting me to speak here today.

Since my appointment I have been very much in listening mode. And from what I’ve heard to date I believe we have good reason to be ambitious for this most globalised sector of our economy.

As of last month we arrived at the mid-point in the implementation of the IFS 2020 Strategy. Employment growth in the sector has been strong and is on target to meet the end 2019 target of an additional 10,000 jobs.

The Strategy launched in 2015, has the vision for Ireland to be the global location of choice for specialised international financial services, building on our strengths in talent, technology, innovation and excellent client services.

We have and will continue to play to our strengths in areas such as Banking, Aviation Finance and Leasing, Investment Management, Funds, Insurance, Data Analytics and Governance, Risk and Compliance.

The area where we are equally well placed to exploit and benefit from is that of fintech and payments.

Notable developments here have been the opening of Deloitte’s blockchain lab last January. This adds to and enhances a healthy eco-system that includes Citi’s Accelerator Hub, Deutsche Bank’s data analytical centre, Accenture’s Fintech Innovation Lab, and Ulster Bank’s partnering with Dogpatch labs to name a few.

These centres of innovation both complement and benefit from our burgeoning ICT sector. Eight of the top 10 global information technology companies have a significant presence here.

Long-established operations – such as Intel, HP, IBM, Microsoft and Apple – have been joined by firms at the vanguard of the internet and social media revolution, including Google, Facebook, LinkedIn, Amazon, PayPal, eBay and Twitter.

Ireland is firmly positioned as the internet capital of Europe.

The critical mass this generates, coupled with the increasing convergence between the financial services and ICT sectors that typifies Fintech, illustrates the massive potential that is being actively pursued – both in terms of FDI and promoting indigenous growth.

I acknowledge Richard Burke of the Fintech and Payments Association of Ireland, on today’s panel. Indeed the membership of this Association reflects the potential from increasing dialogue and crossover between these sectors.

The lines are increasingly blurring.

Accordingly acting in a concerted and coordinated manner to seize opportunities in this space is key to Ireland advancing up the financial services value chain.

Equally so is cultivating a better distribution of employment and investment outside of Dublin. A priority for IFS2020 is encouraging the growth of employment in regional hubs.

Fintech and payments are sub-sectors that have established themselves in our regional locations with well-developed indigenous firms such as the likes of Fexco in Kerry and Currencyfair in Kilkenny.

We have also seen multinational payments and fintech firms opt for regional centres – YapStone’s international headquarters in Louth and First Data’s R&D centre in Tipperary.

Fintech featured prominently in the IFS2020 Action Plan for 2017.

Enterprise Ireland and the IDA have appointed a number of ‘Fintech Advocates’ around the world in key markets. Enterprise Ireland are working to introduce a corporate alliance programme for Payments and Fintech firms.

Important input from industry via the FPAI has resulted in measures to establish an Advisory Panel made up of industry practitioners as a source of domestic and international expertise in support of business in this area.

From an education and skills perspective we have seen the launch of an IFS apprenticeship programme in Fintech in addition to Master’s Degree Programmes.

We are fully aware of the importance of education and skills to the sector and these programmes are designed to ensure we further develop our talent pool to address the needs of fintech firms.

We are already looking towards 2018 and the preparation of the successor to this year’s Action Plan.

Now that we are halfway through IFS2020 I consider it appropriate to undertake a mid-term review of the Strategy. Not least given the impact of Brexit and the need to integrate a rethink of how this incredibly fluid situation will fundamentally alter our alignments within Europe, with the UK and beyond.

It also goes without saying, given disruptive realignment effected by fintech across the financial services sector, that it will remain a key part of IFS2020.

In the coming weeks, officials from the Department of Finance’s International Finance Division will begin to liaise with stakeholders through the IFS2020 framework and begin consideration of measures for Action Plan 2018.

Before I finish I can’t leave without plugging next year’s European Financial Forum. This third edition of the forum will take place in Dublin on the 31st January 2018.

Over the coming month’s we will work to develop an exciting and focussed programme, and will look to build on the success of last year’s panel ‘Reinventing Financial Services through Disruptive Innovation’.

So watch this space.

Thank you for your attention.

ENDS