Cashless economy: Seychelles' financial system to be entirely digital by 2023
Through the strategy, the financial system services are expected to be fully digitalised in two years, eliminating the use of physical cash. (Marco Verch, Flickr) Photo License: CC BY 2.0
(Seychelles News Agency) - The Seychelles' financial system will be almost entirely digitalised by 2023 in line with the Central Bank's technological integration strategy, said a top official on Thursday.
With the government pushing for digital governance, the Central Bank of Seychelles (CBS) had its financial technology strategy approved by the cabinet of ministers last month.
Through the strategy, the financial system services are expected to be fully digitalised in two years, eliminating the use of physical cash.
"This strategy highlights the CBS' contribution towards a digital economy and something we have been working on for a while. It will go a long way to improving the efficiency of the financial sector in Seychelles," said the CBS governor, Caroline Abel.
Financial technology, or fintech, is the use of innovative technology in the design and delivery of financial services and products. It has immense potential to contribute towards economic and social development whereby it can transform the way governments, businesses, civil society and citizens interact and contribute towards enhancing the ease of doing business.
The Central Bank's financial analyst, Brigitte Lucas, outlined three pillars of the strategy, with the first being the establishment of proper digital infrastructure.
"This includes creating proper payment systems, enabling better and affordable access to the internet and also other infrastructures to ensure security and trust in the services," said Lucas.
The second pillar concerns all legal aspects of the strategy. That is mainly in relation to making the necessary amendments to the existing laws, such as the national payment systems act, the financial institutions' act and the cyber crimes bill among others.
The third pillar is the fintech ecosystem and this will see the establishment of fintech services for the government, the private sector and the financing and skills development to encourage fintech supply and demand.
"Work has already begun on implementing the strategy, where we have already started discussions with partners concerning the implementation of payment platforms locally, the reduction of fees charged for digital payments, reliability and affordability of internet," added Lucas.
A number of concerns were raised in the past on access to digital financial services and one of them is the time it takes for a transaction to be completed once a request is made, especially for transferring money from a bank account to another.
Liz Julienne, the director for financial inclusion and market conduct, said that CBS has "already begun work with local banks to see how these services can be offered on a 24-hour basis and in real-time, but there are various mechanisms that need to be put in place to ensure that these measures can be implemented."
She also revealed that CBS will be conducting a study during 2022 where they will be looking at the reliability and affordability of the current financial technology systems, which will help to better implement the strategy.
With the move into digital services, there are people who seek to exploit weaknesses especially true when it comes to digital services.
Abel said that CBS is doing a lot of work to ensure that through fintech, privacy and security can be maintained.
"When we talk of technology, there can never be 100 percent reliability, but what we want is to ensure that these systems are well established, tested and up-to-date to face any attacks that people come up with," said Abel.
She added that this will include better equipping the current institutions that supervise financial services and cybercrime in the Seychelles, an archipelago in the western Indian Ocean.