Kyrgyzstan has chance to become financial center in Central Asia: MP

Bishkek, July 27, 2021 . / Kabar / . Kyrgyzstan has a chance to become a financial center in Central Asia, deputy of the Jogorku Kenesh Samatbek Ibrayev said at a press conference at Kabar News Agency.

He added the country needs to adopt bills in the sphere of regulation of financial technologies (fintech).

"If companies in the financial technologies enter the market, our citizens will be able to keep their savings in gold, because there is a forecast that the pension fund will collapse in 5-10 years. Also, the som (national currency of Kyrgyzstan) is constantly depreciating, so gold will be a reliable asset to withstand against the dollar and the euro. Last year, the National Bank intervened $585 million, and $270 million in six months of 2021 to support the exchange rate of som,” the member of the Parliament said.

In addition, the development of financial technology will make it possible to introduce alternative energy and relieve the crisis in the energy sector.

"Financial technology will also give the opportunity to establish a state bank on new technologies with a minimum authorized capital of $150-200 thousand," Samatbek Ibrayev said.

In turn, Vladimir Frolov, doctor of economics, professor and scientific director of an international financial technologies project of Russia said that som is very weak, which is always pressured by the dollar.

"It is possible to bring gold to the market with minimal commissions, so that Kyrgyzstanis could buy it staying at home, and then people will invest their savings in it. Gold is a more powerful asset than the dollar. Then som will strengthen and it will be possible to spend millions of dollars for other purposes,” he added.

Financial technology (abbreviated fintech or FinTech) is the technology and innovation that aims to compete with traditional financial methods in the delivery of financial services.

It is an emerging industry that uses technology to improve activities in finance. The use of smartphones for mobile banking, investing, borrowing services, and cryptocurrency are examples of technologies aiming to make financial services more accessible to the general public.

Financial technology companies consist of both startups and established financial institutions and technology companies trying to replace or enhance the usage of financial services provided by existing financial companies.