With the goal of making Europe's financial services more digital-friendly and stimulating responsible innovation and competition among financial service providers in the EU, the European Commission announced its adoption of a Digital Finance Package.

This package includes a Digital Finance and Retail Payments Strategies, legislative proposals for an EU regulatory framework on crypto-assets, and on digital operational resilience.

Key highlights of the package are as follows :

Digital Finance Strategy

• Remove fragmentation in the Digital Single Market and obstacles to cross-border operations, enabling greater access to more cost-effective products and services

• Facilitate digital innovation in the interest of consumers and market efficiency by adapting the EU regulatory framework accordingly

• Promote data-driven innovation, building on the European Data Strategy

• Address challenges and risks associated with digital transformation to promote resilience and data protection

Crypto-Assets

• Establish a pilot regime applicable to crypto - assets already governed by EU legislation for market infrastructures that want to trade and settle transactions in financial instruments in crypto-asset form

• Implement a bespoke regime for previously unregulated crypto-assets, including the so-called 'stablecoins' through the supervision and strict regulation (e.g. custody of assets, mandatory complaints holder procedure) of crypto-asset service providers and issuers of crypto-assets providing their services in the single market

Digital operational resilience

• Consolidate and upgrade capacity of firms to withstand Information Communication Technologies (ICT)-related disruptions and threats through risk management capabilities, reporting of major ICT-related incidents, digital operational resilience testing, management by financial entities of ICT third-party risk, oversight of critical ICT third-party service providers, and information sharing among financial entities

Retail Payments Strategy

• Make instant payments and EU-wide payment solutions more accessible and cost effective

• Ensure consumer protection and safe payment solutions

The digital finance package will benefit consumers and businesses by favouring innovation and access to digital products and services in a secure and resilient environment.

More details on the package can be found on the European Commission's website https://ec.europa.eu/info/publications/200924-digital-finance-proposals_en