Any push by big tech companies such as Amazon.com and Google into finance could squeeze banks’ profits and force them to take on more risks, the Financial Stability Board has said.
The entry of Big Tech would increase the impact of financial technology, or fintech, by bringing brand recognition and scale to a sector that’s largely now the preserve of niche startups, the Basel-based global watchdog said in a report on fintech published today.
“The competitive impact of Big Tech may be greater than that of fintech firms,” the report said, because technology giants “typically have large, established customer networks and enjoy name recognition and trust.”
The FSB pointed to China as an example of how big technology companies could take over whole areas of finance. Two companies, Alipay and Tencent, account for 94 percent of the Chinese mobile-payments market.
Big Tech's entry into finance could change competitive landscape, FSB says
14 February 2019 6:27pm