Representatives of National Settlement Depository (NSD), Russia’s central securities depository, took part in the International Financial Congress (IFC). This major financial event was held on 3-5 July 2019 in St. Petersburg (Russia) and was attended by more than 1,200 delegates, including representatives of the Bank of Russia, international financial organizations, and international and Russian experts.
NSD organized the panel discussion «The Role of Infrastructure in Building a Trusting Environment and Simplifying Investor Access to the Financial Market in the Era of Digitalization.»
Discussion participants included Elena Chaikovskaya, Advisor to the First Deputy Governor, Bank of Russia; Maxim Grigoriev, Executive Partner, Gartner; Maxim Getsman, Deputy Director General for Core Business, VTB Registrar; Natalia Smirnova, independent financial advisor; and Igor Kalganov, Managing Partner, Orbita Center for the Practical Use of Blockchain Technologies.
The experts discussed the importance of increasing the general population’s activities in the financial market, investors’ problems, and ways to resolve them and to facilitate investors’ operations. The conversation was focused on the newest technologies that ease investors’ access to the market. The speakers paid special attention to legal issues, in particular, to Bank of Russia’s initiatives to increase the market’s attractiveness to a wider circle of investors.
Eddie Astanin, Chairman of the Executive Board, NSD, moderated the panel discussion. «Creating a technologically advanced trusting environment is a priority task for Russian infrastructure. We have to understand which factors (simplicity, speed, and convenience) are important for the population when investment decisions are made. Cooperating with the regulator and professional market participants, we work hard to ensure that the accessibility of financial services grows, and their convenience and quality meet investors’ demand. This discussion is very useful for participants and NSD,» said Eddie Astanin.
Natalia Smirnova, independent financial advisor, began the discussion. She talked about the profiles of modern investors divided by their investment volumes, preparedness to face risks, and technological preferences. She also highlighted all investor groups’ demands for a single platform with an intuitive interface and a wide set of transparent investment products: «Investors’ behavior is mainly influenced by the economic situation, as well as the presence of a single technological window of their own assets, along with clear rules, transparent terms, and regulatory market support,» said Natalia Smirnova.
Maxim Grigoriev, Executive Partner, Gartner, continued to discuss the issue of investor profiles and market trends: «Around 60% of the companies globally have to review their business models due to rapid changes in the markets and technologies. In 30% of cases, client preferences drive changes; their key need is a so-called „omni-channel“ option allowing clients to get seamless experiences in all physical and digital channels. A financial product shall be affordable, safe, and, at the same time, profitable,» pointed out Maxim Grigoriev.
«Registrars understand their responsibility to scale financial services; we create a trusting environment and speak to investors using the same language. Competition is an important development driver, however, now we are all partners, and I see that in the future, key platforms will interact and become marketplaces for each other,» said Maxim Getsman, Deputy General Director for Core Business, VTB Registrar. «It is important to provide investors with guaranteed access to platforms using government information systems, to use the simplified procedures of identification via USIA and UBS. The State Services Portal may become a unified window to provide information; all this will guarantee transaction safety, and this is a crucial factor to form a trusting environment.» It was noted that the presence of online systems shifts the focus of activity from persons who were born between 1941-1957 to those who were born between 1979-1990.
Igor Kalganov, Managing Partner, Orbita Center for Practical Use of Blockchain Technologies, addressed the subject of digitalization as a driver to develop the investment attractiveness of the market. «Digitalization allows new players to enter the market without high financial costs, and this is a strategic challenge. Companies begin to compete, and their client communication channel becomes more important than the back office. However, it is vital to understand that digitalization may create a trusting environment, but it also produce „bubbles“ beyond the regulated sphere, drawing investors’ focus away and undermining institutional trust,» said Igor Kalganov.
Elena Chaikovskaya, Advisor to the First Deputy Governor, Bank of Russia, described Marketplace project development and emphasized its role in creating a trusting environment. Three to four months after adopting the regulatory changes, the project will be launched with the following basic functionality: an option to attract deposits from the population. «We now see that customers value their time more and more; they need aggregators integrating various market proposals. Competition between aggregators is the key to successful market development. Marketplace platforms will allow transactions to be concluded online via such aggregators. Clients will be able to not only select a bank deposit with the best terms, but also to open it online using their mobile phones. The regulator will control these platforms’ reliability. The Marketplace project will expand the product range step by step, and it will be its educational function too. For us, it is important to completely change the paradigm on the financial market, to let the population invest in different instruments in a clear and convenient way,» said Elena Chaikovskaya.
At the end of the discussion, all participants shared their opinions about what a trusting environment really was, and reached the conclusion that this was an environment that allowed people to operate in a convenient, transparent, stable, and legal manner.