White paper : Internet, the prudential consequences - December 2000
White Paper from the Banque de France and the General Secretariat of the Commission Bancaire, december 2000
The rapid development of banking and financial services on the Internet has created opportunities for financial institutions and for their customers, but also uncertainties. In this perspective, a process of consultation of the industry has been undertaken, through working groups, on the basis of a consultative paper available on line at the web site of the Banque de France.
In response to the growth of this new distribution channel, the White Paper has three purposes.
First, the White Paper presents banking and finance professionals with a set of best practices for internal control, the fight against money laundering, and security, intended for use by the banking professionals and by new entrants licensed by the 'Comité des établissements de crédit et des entreprises d'investissement' (CECEI).
The White Paper also contains proposals to further enhance the security of banking and financial transactions over the Internet. These measures (establishment of hypertext links between financial institutions' sites and the site of the Banque de France-CECEI, definition of a security benchmark within the French Banking Organisation and Standardisation Committee (CFNOB) and implementation of a labelling policy for transactional web sites) are intended to strengthen consumer confidence in new technologies.
The White Paper proposes solutions to the prudential problems arising from the cross-border nature of on-line activity, for consideration in international discussions under way within the Basel Committee on Banking Supervision and between European banking supervisors. These solutions are intended to improve the legal environment of cross-border on line transactions, building on the work of the Electronic banking group of the Basel Committee as described in its October 2000 report.
