Milanović: Due to financial transactions, there was a total control of people. No privacy

Money Motion is titled as the largest “fintech” conference in Central and Eastern Europe, it takes place on Wednesday and Thursday at the Zagreb Fair, and this year’s edition gathers more than 3,000 participants and more than 170 speakers from the fields of banking, payments, technology, “insurtech” and “crypto”.

Milanović, who is also the patron of the conference, assessed that the sphere brought by “fintech” in some way represents “escape from regulators” and a kind of democratization of financial flows.

“What you are engaging in is ‘marginally regulated’, i.e. more unregulated than regulated, and it carries with it certain risks. But I am convinced that it is a good thing and a good supplement to the monopoly of the state and regulators on issuing money. Some kind of alternative”, Milanović believes.

He said that he sees the role of those gathered as an educational one, in order to bring this “complex matter” closer to the citizens, primarily perhaps not for the sake of raising financial literacy or encouraging an entrepreneurial spirit, but rather because of issues concerning “fundamental human rights”.

Namely, he assessed that the level of encroachment of the state, regulators and central financial institutions into “all capillaries of financial transactions” is unprecedented and never greater.

“Control over people’s lives and transactions”

At the same time, he said, as a rule, regulators do not have a democratic mandate, while politicians, on the other hand, “for some reasons, are very inclined to write into laws everything that is proposed to them”. “And they are being offered more and more privacy control. And that is turning into 24-hour control over people’s lives and transactions. And what you spend is you in the end. And that is not a trend, but the situation we are in and which I do not like at all,” said the Croatian president.

According to him, this is all happening because of the alleged greater security and the fight against terrorism. “It’s mambo jambo”, assessed Milanovi, and he wanted to say that such justifications are not exaggerated. meaningful, although they may sound like that.

However, he pointed out that there are justified exceptions, when control is absolutely necessary. “But those are the exceptions, not the rule,” he added.

He told the story to a friend who tried to go around Iceland by bicycle ten years ago. Although he did not succeed, he returned with a “positive impression” that in Iceland “you cannot and should not pay anything in cash, everything is by card”. “I’ve been there several times, but I don’t go anymore. Although I never have cash in my pocket, only cards. But I want to, if I want to, it’s my right (to pay in cash, op.a.),” Milanovi said.

He also added that some “mature and smarter” countries and societies have realized this and do not allow their “cash” to be taken, citing the example of Germany, Austria and the “powerhouses” of some Scandinavian countries.

Tomašević: The city of Zagreb is trying to keep up with digitization

Zagreb Mayor Tomislav Tomaševi said that he was “greatly honored” that such an “important global conversation” about the future of finance and technological innovation was being held in Zagreb.

He stated that the “fintech” sector shows that good ideas and innovations are changing the entire financial sector, and “even start large financial institutions”, which can no longer ignore all the innovations that are happening in “fintech”.

He also said that the City of Zagreb is trying to keep up with digitization, and he singled out three projects that received “various awards in the world”.

These are iTransparency, a platform that displays every financial transaction of the City of Zagreb, of which there are more than 130 thousand per year, then the project of mapping all business premises and apartments owned by the city, and finally participatory budgeting, a digital tool that enables citizens to decide on the financing of individual neighborhood projects.

There will be more and more “neo-banks”

Former governor of the CNB and consultant in central banking, Marko Škreb, stated that the financial sector is changing very quickly, and the main direction is the digitization of all banking services. Although it is difficult to fully predict, Škreb is convinced that banks will continue to exist, but not in their current form, considering the fact that more there is a trend of reducing the number of branches and “physical” contact between banks and clients.

“There will be more and more ‘neo-banks’, that is, banks that do not have a physical headquarters, of which there are more than 150 in Europe, while the existing banks are increasingly moving to digital platforms,” ​​said Škreb.

And he is of the opinion that citizens must have a choice when paying and that they will still be able to do so with cash, that is, with bills and coins. However, he also believes that fewer and fewer of them will choose this method of payment.

Josip Majher, a member of the Management Board of Hrvatska poštanska banka (HPB), is of the opinion that there has been a certain separation between payment transactions on the one hand and the “rest” of banking, that is, loans and deposits, on the other.

In the payment transaction, he said, various “fintechs” are “playing” and there is much more competition, while citizens are somewhat more traditional when it comes to about loans and deposits and the “human touch” is important to them. “Banks will win by implementing a hybrid model,” said Majher.