The Central Bank talks about taxes on the CFA, new functions …

The Central Bank talks about taxes on the CFA, new functions … post thumbnail image

The regulator has published a draft directive for the development of the Russian fintech market for the next three years.

The Bank of Russia told in which direction the regulator will develop fintech in the country in the next three years. This is known from the project “The main directions of digitizing financial markets for the period 2022-2024.”

  • Central Bank specialists draw attention to international trends in financial markets. In particular, regulators around the world have targeted financial and non-financial service ecosystems, open APIs, digital transformation at all levels, as well as the deployment of cryptocurrencies and the development of central bank digital currencies.

  • The priority areas for digitizing Russian financial markets were selected based on a study by the FinTech Association, which was carried out in conjunction with consulting firm Accenture.

Priority areas for digitizing Russian financial markets. Source: Central Bank of the Russian Federation.

Read also: banks are leading the way in using fintech solutions, the AFL finds.

  • Digital financial asset regulation (DFA) and crowdfunding are also highlighted among the key areas. The Bank of Russia says that by 2024, the law will include a clause on taxation of transactions with the CFA. In particular, these assets and transactions with them are subject to VAT, personal income tax and corporate income tax. Taxes will also be paid by the operator of the investment system for the issuance of the CFA, as well as the operator of the asset exchange.

  • The Bank of Russia will continue to develop infrastructure projects. When describing the “Integrated Biometric System”, the regulator spoke about the expansion of the use of biometrics in finance. According to the document, bank customers will be able to get loans, open deposits or cancel dubious transactions remotely – using biometric data.

  • In the Fast Payment System (FPS), Russia will be able to pay for government services (C2G), as well as receive budget payments (G2C). The Bank of Russia plans to expand the functionality of the SBPay mobile application, for example, users will be able to pay for utilities. In 2022, the Central Bank plans to conduct a salary transfer pilot project using AMPL.

Read also: how Fast Payment Systems work will change in 2022.

  • Mir card market share will increase, regulator predicts. The Central Bank plans to introduce and scale innovative technologies into the system and develop the Mir Pay mobile application. It is planned to expand non-financial and social services (transportation, campus, student cards and others with non-financial functions, including resident cards). The NSPK card will continue its expansion in EAEU countries and “a popular tourist destination for Russia,” the draft said. As a reminder, it was recently discovered that in 2 years Mir will appear in all payment applications in Russia.

  • It is planned to expand direct sales of bonds to residents, the Central Bank said. For this, a pilot project of a financial platform, as well as a Marketplace system, will be involved. On the basis of the Masterchain platform, the Bank of Russia will launch a pilot project for the digitization of mortgages.

  • In 2022, the regulator will launch the first phase of testing the digital ruble platform. The Central Bank will link credit institutions with it and carry out the first transactions with a Russian CBDC between individuals. In the second stage, the smart contract functionality will be implemented, as well as 2B, B2C, B2B, C2G, G2C, G2B, C2G, B2G operations. In the future, exchanges, brokers, markets, insurance companies and other financial intermediaries will be able to connect to the system, the document says.

  • To increase the efficiency of its own activities, the Central Bank introduces various technologies. Among them are artificial intelligence, robotization, biometrics, machine-readable regulation, cloud services, technologies for collecting, processing, storing and visualizing data.

  • To develop the security of the state financial system, the Bank of Russia will begin to introduce cyber instructions. Such a stress testing mechanism will be key in assessing the cyber risk of financial organizations, the Central Bank said.

We will remind you, recently it became known that the Bank of Russia offers banks to return funds stolen by fraudsters to clients. Credit institutions must calculate the amount of compensation themselves.

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