MNB Publishes Report on Fintech and Digitization in Hungary
MNB published a the fintech and digitization report that offers an insight into the domestic and international trends in financial innovation, digitization, and the development of technologies supporting them. The report summarizes the international fintech and digitization processes and trends and provides an analysis of the domestic fintech sector. The report also offers a comprehensive picture of the level of digital readiness of the domestic banking system and the insurance sector based on a detailed, individual institutional-level survey of MNB.
The report highlights that Hungarian fintech sector has continued to expand and more than 130 active companies are engaged in fintech activities in Hungary. Domestic fintech companies are typically still active in financial software development and systems integration, data analysis and business intelligence, and payment services. The MNB Innovation Hub, which was Launched in March 2018, serves as a platform for direct and flexible contact with financial innovators. Based on the MNB's second comprehensive banking system digitization survey, significant catching-up was observed in several participants in the past year, with the digitization of the domestic banking system showing significant development. Over the past year, growth has been observed primarily in previously less developed areas such as digital product access and digital customer engagement.
Due to the epidemic situation, developments supporting external relations came to the fore, less resources were allocated to the development of the digitization of internal operations. In view of this, the domestic banking sector should pay more attention in the future to developments affecting internal systems and processes to exploit the potential of digital transformation and strengthen the competitiveness of the sector. To implement the digital banking transformation covering all sub-areas, an MNB recommendation issued in March 2021, which is also a novelty at the international level, provides guidelines for the actors of the banking sector. The recommendation expects credit institutions to develop a comprehensive digital transformation strategy and timetable and to send it to the central bank.
Keywords: Europe, Hungary, Banking, Insurance, Fintech, Regtech, Digital Transformation Strategy, Innovation Hub, MNB
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