BIS Paper: Asia Virtual Banks Must Protect Consumer Data

A new Bank for International Settlements paper says Asian regulators must protect consumer data as financial institutions dole out more virtual bank cards, noting the distribution will boost financial inclusion across the region, according to a Bloomberg report Thursday (Jan. 27).

The BIS paper adds that access to bank accounts is increasing, but “the use of the financial system to save and borrow is low both for developing economies and those with high levels of income and education, a gap that can be closed by technology.”

Technology “brings down transaction costs for serving higher risk customers and virtual banks in Asia could mean financial inclusion takes an important step forward,” the BIS report.

Policymakers must make customer data protection a priority, said Siddharth Tiwari, BIS chief representative for Asia and the Pacific and a co-author of the paper, in the report.

“It is a deep public policy concern that across increasingly large segments of the economy, data controllers can trade data that individuals have generated without their permission,” said Tiwari. “The question is: who has control over this data, where should it be stored, who and under what conditions should it be shared and who should operate this data governance system?”

Related: Coupa, HSBC Offer Virtual Cards to European Companies

Earlier this month, business spend management firm Coupa Software partnered with HSBC to offer companies in Europe virtual cards.

“The availability of HSBC virtual cards on the Coupa platform will ensure customers have all the benefits of virtual payments, including speeding up payment processes and improving liquidity and working capital,” said Roger Goulart, executive vice president of business development and alliances at Coupa.

Coupa Software offers cloud spend management solutions for businesses, including a suite of financial applications for business spend management. HSBC — the Hongkong and Shanghai Banking Corporation — is a banking and financial services organization that first opened in Shanghai in 1865. It is the second-largest bank in Europe, behind BNP Paribas, and the world’s sixth-biggest bank.