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S/FIN/M/9 4 
 
24 August  2020 
(20-5829) Page: 1/4 
Committee on Trade in Financial Services    
 
 
REPORT OF THE MEETING HELD ON 14 JULY 2020  
NOTE BY THE SECRETARIAT1 
The Committee on Trade in Financial Services held a meeting on 14 July , under the Chairpersonship 
of Mr. Ding Li (China). The agenda was contained in document WTO/AIR/CTFS/1 1. An annotated 
agenda had been  circulated  prior to the meeting (document JOB/SERV/298 ). 
1  THEMATIC SEMINAR "FINTECH: TRADE, FINANCIAL INCLUSION AND DEVELOPMENT " 
1.1.  The Chairperson  informed  delegations  that a thematic seminar on "FinTech: Trade, Financial 
Inclusion and Development" had been  held on 13 and 14 July. As explained in the annotated agenda 
for the meeting, this was an abridged version of the seminar that should have been h eld prior to the 
meeting scheduled in March but that, due to the COVID -19 pandemic and related measures, had to 
be postponed. The revised program of the seminar was circulated in document RD/SERV/155 . The 
primary motivation of the seminar was to apprise Members of the latest developments r egarding 
Fintech, with a view to examining the interplay between Fintech, trade in financial services and 
development.  
1.2.  The Chairperson further considered that , as had become  clear from the discussion at the 
previous meeting of the Committee as well as his consultations, Members were interested in pursuing 
discussions on Fintech, mindful that the Committee constitute d the appropriate forum for the 
examination of technical matters – such as the relationship between Fintech developments and trade 
in financial services. The purpose of this agenda item was therefore to follow -up on the seminar.  
The Chairperson invited Members to (i) share their experiences and views regarding the relationship 
between Fintech and trade in financial services, (ii) start mapping out  potential issues for further 
discussion, and (iii) consider ways to take these issues forward in the Committee.  
1.3.  The representative of China  congratulated the Secretariat for organizing a ve ry informative and 
thought -provoking seminar on Fintech . He also paid tribute to Members for their support and active 
participation. He expressed the hope that Members could keep the momentum and continue with 
the constructive dialogue on Fintech -related issues in the Committee. The seminar identified areas 
where further work could be pursued , so as  to deepen Members' understanding of how Fintech might 
contribute to clos ing the digital divide, which was essential to achiev e the goal of sustainable 
development  in developing and least -developed countries . He furt her considered that the interest 
and participation of the private sector and  regulators c ould be strong driving forces for the work at 
the WTO. The seminar allowed Members to learn about the latest development s related to Fintech, 
including business models  and regulatory experience, which could service as inputs into future 
discussions in the Committee. As the presentation by the Secretariat highlighted, it was important 
to ensure that trade policy in financial services support ed Fintech, while ensuring consumer 
protection and financial stability and integrity. In his view, the Committee should continue 
brainstorming about these issues, so as to provide insights to trade negotiators. He added that China 
was ready to work closely w ith Members to continue discussi ng these issues in the Committee.  
1.4.  The representative of Switzerland  also thanked the Chairperson and t he Secretariat for the 
organization of the seminar.  The seminar provided Members with a better understanding of both the 
potential of FinTech and the challenges it pose d. He said that Switzerland would  support any initiative 
allowing to continue and deepen these exchanges. However,  in his view, a future discussion should  
 
1 This document has been prepared under the Secretariat's own responsibility and is without prejudice 
to the positions of Members or to their rights and obligations under the WTO.  S/FIN/M/ 94 
 
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  more specifically address trade policy  – in other word s, how WTO Members might provide Fin tech 
with better access to international markets, thereby fostering financial inclusion.  He then highlighted 
the main aspects of Switzerland's experience with FinTech and financial services trade . Switzerland 
followed a technology -neutral approach for the regulation of financial services. This approach was 
based on the "same risk, same regulation"  principle. The emergence of FinTech  suppliers  
necessitated ad hoc adaptations of legislation to take account of their business model s. Such 
adaptations included, for example, the creation of a new license category dedicated to finance 
innovators , notified to the WTO ( S/C/N/922 ). This amendment  to the law result ed in the reduction 
of barriers to market entry without compromising the level of consumer protection. This adaptation 
fostered trade in financial services in areas such as asset management, deposit -taking and lending, 
payments and banking infra structure, where many of the new businesses were foreign -owned. 
Another adaptation concerned a pplications based on Distributed Ledger Technology. This adaptation 
of the legal framework , which was still under consideration in Parliament , aimed at increasing  legal 
certainty, remov ing obstacles to the use of this technology, and limit ing the risk of abuse.  In 
conclusion, the strategy pursued by Switzerland aim ed to create a framework that promotes 
innovation, on the one hand by guaranteeing legal certainty, an d on the other hand by creating a 
climate of trust for both entrepreneurs and consumers. The latter was essential, regardless of the  
degree of development or maturity of FinTech.  
1.5.  The representative of Canada  thanked the Chairperson and the Secretariat for organizing the 
thematic seminar, which was found to be very informative.  Many important points were raised about 
the benefits and risks of Fintech and "open banking ". At the same time, consideration would need  
to be given to the nature of solutions that were best suited for discussion at the WTO. In that regard, 
she noted the point made during the seminar about the importance of ensuring legal certainty for 
Fintech  suppliers  operating in an international contex t. She also noted  the point made by the 
Secretar iat that it was i mportant to ensure that trade policy in financial services support ed Fintech, 
while ensuring consumer protection and financial stability and integrity.  Indeed, she considered that 
it would be important to take into account how a conversation about Fintech at the WTO interface d 
with the ongoing work by international standar d setting bodies in the financial sector. As far as the 
Committee on Trade in Financial Services was concerned, Canada felt that it would be useful to 
explore how trade policy could help or hinder financial innovation.  
1.6.  The representative of Mexico  found th e seminar on Fintech very interesting. The discussion on 
these issues should continue in the Committee, drawing a direct link with the Committee's objective, 
namely the analysis of specific commitments in the GATS and their relationship with Fintech. In he r 
view, many Fintech products went beyond Members' commitments in the financial sector, which 
were well-circumscribed, due to the involvement of information technology and telecommunications 
services. Further discussion in the Committee would allow Members  to better understand the 
regulatory challenges facing many countries in the area of Fintech, and how their specific 
commitments in services might help in that regard.  
1.7.  The representative of India thanked the Secretariat for organising the thematic seminar on 
"Fintech: Trade, Financial Inclusion and Development ." She also thanked the speakers for the very 
informative present ations . The session on "digital financial inclusion" had been  particularly u seful, 
especially the discussion on how to leverage technology to promote financial inclusion. Financial 
inclusion contribute d to economic development and growth, and its significance at the time of a 
global pandemic bec ame all the more critical.  In develo ping countries like India, technology had 
been playing an important role in expanding access to banking, insurance and financial services. 
Over the past few years, technology allowed t he Direct Benefit Transfer (DBT) mechanism to reach 
out to the targeted population with just -in-time transfer of resources, without leakages due to unique 
identity . During the pandemic, m ore than 200 million poor and needy population benefitted with 
direct monthly transfers in their bank accounts. Not only were their accounts credited on time, but 
even access to these bank accounts was ensured at their doorsteps through the model of banking 
corresp ondent. All this was possible due to the use of technology in the delivery of financial services.  
1.8.  The representative of the Republic of Korea  said that the seminar on Fintech had been  very 
informative. Fintech  was a new industry that provide d innovative financial services to all related 
players , such as financial corporations, tech nological  companies and above all finance consumers , 
including households and MSMEs. This innovation lead to reduced financing costs and  more 
opportunities. He highlighted two aspects. First ly, in addition to enlarged financial opportunities due 
to fintech  governments needed to pay attention to financial literacy. Domestic and foreign consumers 
who were presented with more opportunities by digital financial corporations need ed to be informed S/FIN/M/ 94 
 
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  of every aspect of the transaction  in an appropriate and effective manner.  Secondly, governments 
must strike a balance between data utilization and the protection of personal information. The 
relationsh ip between the protection and the use of consumers' personal information varied 
significantly from country to country. In Korea, the national assembly recentl y passed three laws on 
data. The goals of these laws could be summarized as the introduction of th e concept of "alias" 
information to revitalize data use, the streamlining of the privacy system, the strengthening of 
accountability in the handling of personal information, and the clarification of ambiguous criteria.  
Korea supported a discussion of these issues among Members.  
1.9.  The representative of the United States  thanked the panellists for their interesting 
presentations in the seminar. He said that the Committee should focus on its specific role, namely 
to look at trade in financial services and  how specific  commitments could  help facilitate the reduction 
of barriers to an open and competitive market environment which encourage d innovation  in financial 
services. A number of Members introduced restrictions on cross b order data flows and forced data 
localisation , which  led to increased costs and undermine d efficiency, security and the ability to 
innovate . The United States would like the Committee to continue examining Fintech -related issues, 
keeping the focus on trade  rules and commitments.  
1.10.  The representative of Hong Kong, China  thanked the Chairperson and the Secretariat for 
organising the seminar . The seminar provided a valuable opportunity to enhance Members' 
understanding on Fintech and its relationship with trade in financial services. The development of 
Fintech was a policy priority for Hong Kong, China. Fintech was driving innovation and grow th of 
financial services globally, changing not only the nature of commerce and end -user expectations but 
also the regulatory environment. Fintech was emerging as an important topic in the global trade 
scene, and Hong Kong, China welcomed opportunities for  further discussions with Members within 
the mandate of the Committee, including on the challenges and opportunities faced by SMEs and 
the unbanked population.  
1.11.  The representative of the European Union  thanked the Secretariat for organising th e thematic 
seminar, which had allowed Members to learn about the latest developments related  to Fintech and 
the interplay between Fintech and trade in financial services. Presentations had shown the 
importance of digitalisation and its impact on business and consumers, both in developed and 
developing countries.  Consumers and firms were increasingly turn ing to digital technologies when 
using and providing financial services. The European Commission was finalizing a Digital Finance 
Strategy setting out the European Union's priorities and actions in pooling and sharing data in the 
financial sector. The Digital Finance Strategy was expected to be released at the end of 2020. The 
Strategy aimed to address th e obstacles faced by firms whe n attempting to scale up their services 
across the Single Market. It  also aimed to identify ways to facilitate access to publicly available data 
in the financial sector. She added that the strategy would look at changes in the  market structure 
prompted by the entry of large technological firms into financial services and  consider  the ability of  
EU financial regulation to deal with the associated risks and opportunities.  The EU would be 
interested to learn from Members' experien ces and policy actions aimed to enhance opportunities 
provided by Fintech and to address the relevant risks.  
1.12.  The representative of United Kingdom  thanked the Chairperson and the Secretariat for the 
organization of the Fintech seminar. The UK was a leading global Fin tech hub with a thriving 
ecosystem that was home to an increasing number of Fin tech firms that export ed globally.  The UK 
Fintech sector employ ed over 76,500 people and generate d an annual revenue of £6.6 billion.  The 
focus of UK government support for Fin tech was the creation of an appropriate regulatory 
environment . The UK's Financial Conduct Authority was given a strong competition objec tive, which 
led to it establishing an Innovation hub and Regulatory Sandbox.  The government also supported 
innovation in payment systems, creating a new Payments Systems Regulator in 2015, the first of its 
kind in the world.  Like the Financial Conduct Auth ority, the Payments Systems Regulator was given 
a clear remit to promote and support innovation.  The government also legislated to allow non -bank 
payment service providers direct access to payment systems, creating a level playing field with 
banks.  Since 2 010, the UK government ha d worked hard to promote competition and new entrants 
into financial services markets and a number of a new players ha d been able to provide better digital 
banking offerings. Features of these products and services include d the fol lowing : more accessible 
financial advice  that enabled consumers to make better use of their savings , and better ways to 
understand an individual 's credit history  so as to facilitate access to suitable  credit products.  The 
UK's approach to Fin tech included the roll out of "open banking ", which provide d a secure way for 
consumers to share their current account data, opening up a wide range of new and innovative S/FIN/M/ 94 
 
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  products that better meet their needs.  This include d better tracking of payments to st op customers 
becoming overdrawn, and smart debt repayment plans that c ould account for fluctuations in income.  
Over a million consumers were already using "open banking", a nd a report last year estimated that 
consumers could gain up to £12 billion from open banking -enable services, worth up to £230 per 
year for individuals.  
1.13.  The representative of China  said that Fintech was driving financial development. Innovation 
in the financial services was promoting new business models. In that regard, China adhered to the 
principle of inclusive and prudent regulation to support the development of new business models. 
He took the opportunity to share China's experience with Fintech, focusing on e -payments services. 
In 2019, banks in China processed 223 billion e -payment transactions (equivalent to RMB 26 billion), 
of which 78.1 billion transactions (RMB 26 billion) and 101 billion transactions (RMB 3.4 billion) 
corresponded to online and mobile payments, respectively. The rapid development of Fintech might 
render the existing regulatory framework outdated. Governments should therefore closely follow the 
evolution of tech nology and make sure that regulation meets the needs of industry. China submitted 
several e -payment related proposals in various WTO bodies, including the Council for Trade in 
Services, the Council for Trade in Goods, and the Joint Statement initiative on e-commerce. The 
proposals aimed at reducing barri ers and creating a safe, stable, fair, and compet itive environment 
for the development of e -payment services. Members should continue exchang ing views and sharing 
their experiences on Fintech. In that regard , he indicated that China supported that the Committee 
continue exploring Fintech -related issues.   
1.14.  The Chairperson  concluded that many Members expressed interest in further discussing these 
issues and keeping the momentum of work in the Committee. Some Mem bers suggested topics for 
further discussion, including to focus on trade policy aspects and in particular on the analysis of 
specific commitments and trade barriers. Some Members also shared their domestic experience in 
the area of Fintech and encouraged others to do likewise.  
1.15.  Following the suggestion by the Chairperson, t he Committee took note  of the statements 
made and agreed  to revert to this issue at the next meeting.  
2  OTHER BUSINESS  
2.1.  There were no issues raised under Other Business.  
3  APPOINTMENT OF THE CHAIRPERSON OF THE COMMITTEE  
3.1.  The Committee elected  Mr. Seo -jin YANG, from the Republic of Korea,  as its new Chairperson.  
 
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