The Bank of Lithuania has chosen two companies to create and test a smart solution that would streamline reporting procedures – information for supervision purposes would be generated in a uniform format and collected automatically by the Bank of Lithuania, thus reducing the administrative burden.
“Such a solution will allow market participants to save time and reduce HR costs and IT investment expenditure. It will also allow us – the supervisory authority – to generate reports in a timely and precise manner, gain insights on potential market risks and share them with financial market participants, which would guarantee greater efficiency of supervisory practices, especially as the number of market participants continues to grow,” said Ramūnas Baravykas, Head of RegTech and Advisor to the Director of the Supervision Service of the Bank of Lithuania.
The idea to develop a RegTech solution was brought in partnership with GovTech Lab. The prototype of the information exchange tool will be created by Peekdata.io and Columbus Lietuva, UAB. The companies will use an application programming interface (API) software, a key element of open banking that has helped increase competition in the payments market and introduce new services for consumers and businesses. To make the testing phase more realistic and productive, UAB ConnectPay, Interpaylink, and Paysolut granted access to their test data.
Currently, payment service providers (banks, credit unions, other credit institutions, electronic money and payment institutions) have to submit to the Bank of Lithuania statistical reports and reports for supervisory purposes, which is time-consuming and requires considerable resources. The Bank of Lithuania is therefore looking for an innovative solution that would allow obtaining the necessary data and automatically generating analytical reports, thus avoiding conflicting interpretations. The prototype (MVP) of the solution is expected to be developed at the beginning of 2020.