Big Tech Firms to Disrupt Global Financial System

• Big Tech Firms to Disrupt Global Financial System -IMF

Big technology firms are expected to disrupt the global financial system given the amount of data they can access and the evolution of artificial intelligence in recent years, Christine Lagarde, the head of the International Monetary Fund (IMF) stated.

Christine Lagarde, who was attending the G20 Finance Ministers’ summit in Fukuoka, Japan, said few technology companies with big data could dictate global payment and settlement system if nothing is done.

“A significant disruption to the financial landscape is likely to come from the big tech firms,” Ms Lagarde stated in Japan.

She said those companies “will use their enormous customer bases and deep pockets to offer financial products based on big data and artificial intelligence”.

“This presents a unique systemic challenge to financial stability and efficiency,” she added.

Ms Lagarde cited China as a key example.

“Over the last five years, technology growth in China has been extremely successful and allowed millions of new entrants to benefit from access to financial products and the creation of high-quality jobs,” Ms Lagarde said.

“But it has also led to two firms controlling more than 90% of the mobile payments market.”

The ministers also discussed tax loopholes for internet giants like Google and Facebook, saying internet companies should pay tax where they make their profits and not the country of their headquarters.