Bank of England and Bank for International Settlements Establish Innovation Hub in London

The Bank for International Settlements (BIS) and the Bank of England (BoE) revealed on June 11, 2021, that they’ve introduced the BIS Innovation Hub London Centre, which is notably the fourth Innovation Hub Centre to have been launched in the last couple years.

The BIS and its partners are taking a “leading role” in coordinating the work of reserve banks on tech innovation in the financial industry to pave the way forward for the “future of central banking,” Agustin Carstens, GM at BIS, noted.

This new Centre in London “reflects the Bank of England’s critical role as an innovator in responding to the challenges and opportunities of the digital world while safeguarding financial stability,” Carstens added.

Andrew Bailey, Governor of the Bank of England, stated:

“As a central bank, we recognize the importance of innovation for the global financial system and look to support its safe deployment wherever possible. This requires collaboration between public authorities in all jurisdictions, and the BIS Innovation Hub is an important global initiative for achieving this.”

This launch is part of a plan “to expand the global reach of the BIS Innovation Hub, which also includes the opening of Centres with the Bank of Canada (Toronto), the European Central Bank/Eurosystem (Frankfurt and Paris) and the four Nordic central banks (Danmarks Nationalbank, the Central Bank of Iceland, the Central Bank of Norway and Sveriges Riksbank) in Stockholm.”

In January 2021, the BIS “signed a memorandum of understanding for a strategic collaboration with the Federal Reserve System (New York).”

Benoît Cœuré, Head of the BIS Innovation Hub, noted that he’s pleased to welcome the next phase of the BIS Innovation Hub’s expansion with “the establishment of the new Centre with the Bank of England in London, where there is such a strong nexus of technology and finance.”

Through this collaboration, the BIS Innovation Hub will “continue to develop key public goods that address financial sector issues of importance to central banks,” Cœuré said.

The BIS Innovation Hub’s work program is focused on the use of tech innovation in supervision and regulation (suptech and regtech); updated financial market infrastructures; central bank digital currencies or CBDCs; open finance; cybersecurity; and “green finance.”

Work related to these themes is “distributed across the various Hub Centres,” the release noted.

The United Kingdom is well-known for continuously pushing the boundaries of digital finance so it’s “great to have the new Innovation Hub opening here,” Rishi Sunak, UK Chancellor of the Exchequer said while noting that its work will “help central banks to support safe innovation, and boost our efforts to capture the extraordinary potential of technology.”

A virtual or online seminar on the launch was “held today at 09:30 BST/10:30 CEST.” Further details can be accessed here.

Speakers included:

Bank of England: Andrew Bailey, Victoria Cleland, Jon Cunliffe and Dave Ramsden
Bank for International Settlements: Agustín Carstens and Benoît Cœuré
Chancellor of the Exchequer Rishi Sunak

External panel members:

Katharine Braddick – HM Treasury, Sujata Bhatia – Monzo, Ann Cairns – MasterCard

The BIS Innovation Hub was formed in 2019 by the BIS “to identify and develop in-depth insights into critical trends in financial technology of relevance to central banks, to explore the development of public goods to enhance the functioning of the global financial system, and to serve as a focal point for a network of central bank experts on innovation.”

BIS Innovation Hub Centres are now in place in Hong Kong SAR with the Hong Kong Monetary Authority, Singapore with the Monetary Authority of Singapore, and Switzerland with the Swiss National Bank.

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