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New rules may be needed for payments in wake of Wirecard, BIS boss says

Reuters 2020-06-30 12:06:00

LONDON (Reuters) - More joined up rules may be needed across the payments sector after the collapse of Germany’s Wirecard AG, Bank for International Settlements president Augustin Carstens said.

Wirecard’s demise has thrown a spotlight on payments, which is one of the fastest growing sectors in financial services and which central banks could enter themselves by developing digital forms of national currencies.

“One of the key aspects will be how different and non-bank participants and payment service providers can be incorporated into the whole scheme,” Carstens told reporters.

Payments have broadened out beyond banks to include so-called fintech firms which offer smartphone apps for making and receiving payments.

For now it was hard to tell if changes in regulation will be needed in the wake of the Wirecard scandal, Carstens said.

“As more details transpire I think that we will be able to pinpoint if or not further supervisory or regulatory action is needed,” the BIS head added.

The implosion of Wirecard came years after the first allegations of fraud by some investors and journalists and the focus is now shifting to how regulators supervised a company that was hiding a $2.1 billion hole in its books.