The central bankers' bank is singling out Basel as one of three spots to set up innovation hubs. The move highlights the alpine nation's relatively modest efforts in this respect so far.
The Bank for International Settlements will set up three so-called innovation hubs for central banks, the institute said in a statement on Sunday. The first two centers will be in Basel, Switzerland and Hong Kong, while Singapore will follow pending conclusion to «institutional arrangements», the BIS said.
The move brings attention to the Swiss central bank's reluctance thus far to get too involved in the furor of innovation in blockchain and cryptocurrency in particular which has sprouted up in the alpine nation. By contrast, Bern's regulators and lawmakers have been more welcoming.
«The SNB will continue to step up its efforts in this regard, and will play an active role in the BIS innovation hub from the outset,» Swiss central bank head Thomas Jordan said in a separate statement.
Americas, Europe Next
The SNB didn't elaborate on specifics of the center beyond its location in Basel. The BIS said it wants to spot and develop central banking technology trends, develop utility technology to better the global financial system, and have a focal point for a network of central bank experts on innovation.
The second phase will include further centers in the Americas and Europe. «The establishment of the BIS innovation hub will enable central banks to extend their existing collaboration with a view to identifying relevant trends in technology, supporting these developments where this is consistent with their mandate, and keeping abreast of regulatory requirements with the objective of safeguarding financial stability,» BIS Chairman Jens Weidmann said.
Nod for Singapore
The nod for Singapore reflects the city-state's position as a leading international fintech center, the Monetary Authority of Singapore said in a separate statement. «To fully harness the benefits of these innovations while ensuring the resilience of the financial sector, central banks must also innovate – to modernize the technology infrastructure and regulatory arrangements that underpin digital finance and the digital economy,» MAS head Ravi Menon said.
Singapore and Hong Kong, by far the larger financial center by assets, compete fiercely to attract finance startups. By contrast, Basel is a backwater – though it is where the BIS maintains its headquarters.
