Each of our research centres has unique ways to engage with non-academic organisations and, through that, to generate real world impact. This month we are sharing the work of the Cambridge Centre for Alternative Finance at Cambridge Judge Business School.
The impact and engagement of the Cambridge Centre for Alternative Finance (CCAF) takes place through its programmes of empirical research, research collaborations, education and capacity building activities and its development of digital tools. All of these elements combine to work towards a mission to “create and transfer knowledge addressing emergent gaps in the financial sector that supports evidence-based decision making focused on FinTech”.
Building relationships, extending reach, informing evidence-based decisions
The CCAF’s engagement with academic and industry partners globally, as well as with regulators and policymakers, has continuously increased since its foundation in 2015. More than 2,300 fintech platforms in over 180 countries were surveyed for first Global Alternative Finance Benchmarking Study; more than 200 crowdfunding and peer-to-peer lending industry bodies and associations, fintech hubs, innovation centres and ecosystem stakeholders have been collaborated with; and more than 118 central banks and other financial regulators were surveyed to understand how they had coped with the challenges brought by COVID-19 (coronavirus).
The Centre’s research credentials, built through these relationships and reach, have been underlined with the publication of a white paper for the Foreign and Commonwealth Office (now the Foreign and Commonwealth Development Office), a report for the UN Secretary-General’s Special Advocate for Inclusive Finance for Development (UNSGSA), a collaboration with the Organisation for Economic Co-operation and Development (OECD) and the running of a conference on ‘Regulatory Innovation in the age of FinTech’ with FSD Africa.
Digital tools and the future of regulation
Work with regulators highlighted a clear demand for capacity building through education and insight into regtech. In response, the CCAF completed the first stage of its applied regtech research and launched an online prototype, RegSimple, with a roadmap to providing machine-readable regulatory support. This digital tool simplifies the comparison of financial regulation across different jurisdictions, enabling regulators, particularly in developing and emerging economies, to keep pace with the accelerating digitisation of financial services.
Within the cryptocurrency and blockchain stream of work, the Centre’s digital tool portfolio also includes the Cambridge Bitcoin Electricity Consumption Index (CBECI). This website provides a real-time estimate of the electricity consumed by the Bitcoin network, as well as delivering an interactive map which visualises the average monthly share of Bitcoin’s hashrate.
Most recently, the CCAF’s proven ability to deliver through its RegSimple digital tool and its extensive engagement with regulators have been deployed in the University’s Regulatory Genome Project (RGP). The RGP’s mission is to sequence the world’s financial regulation to act as a reference repository of financial regulation in machine-readable form in order to catalyse innovation across the financial services sector.
Innovative education for innovative regulation
Further plugging the regulatory knowledge gap, the Centre runs its Cambridge Fintech and Regulatory Innovation (CFTRI) programme. CFTRI is a tutor-led online education programme aimed at senior policymakers and regulators at central banks, security agencies and ministries of finance. Launched in October 2019, more than 870 regulators/policymakers from 130 countries globally have now completed the programme.
The CFTRI not only leverages the latest findings from the CCAF’s regulatory research but provides feedback and insight that informs content for the following cohorts and for alumni community resources. One such resource is a recently established platform for CFTRI alumni that is a secure digital community for regulators and policymakers to share knowledge and resources that will help them to achieve efficiencies and impact in the regulation and supervision of financial services.
A collaborative approach
All of these areas of focus – research, digital tools and education – are enhanced by the recently launched Cambridge Alternative Finance Collaboration Network (CAFCN). The network catalyses knowledge exchange between multiple stakeholders with the aim of supporting increased financial inclusion, stimulating economic growth and reducing poverty.
The CAFCN’s physical infrastructure layer is made up of strategically situated regional research collaborations that form a mesh network to facilitate knowledge creation, exchange and transfer. These collaborations already include FSD Africa (Sub-Saharan Africa), ADGM Academy (Middle East and North Africa), European University Cyprus (Euro-Mediterranean) and ADB Institute and Cambridge CARES (Asia Pacific), with immediate future plans for Latin America and Caribbean, South Asia and North America. Each of these collaborations:
- Generate regional empirical data and contribute to global research initiatives.
- Develop and provide access to digital tools for the consumer, industry and regulators.
- Deliver online and in-situ education and technical assistance programmes to accelerate regulatory innovation.
Making an impression
The CCAF’s reports and empirical data have helped inform the work of governments, national banks and international organisations including the Ministry of Finance in Japan, the Bank of England, the IMF, The Parliament of Australia, the OECD, the European Parliament and the UN, to name but a few. A recent example of this policy impact was seen in the introduction of new legislation to establish a regulatory framework of digital assets in The Bahamas. In introducing the Digital Assets and Registered Exchanges Bill, 2020 (DARE Bill), the CCAF’s 3rd Global Cryptoasset Benchmarking Study was cited as a source of influence.
As always, awareness of the Centre’s work is impacted by its media profile, which in turn influences key decision makers and widens the reach of its reports and publications. The CCAF has enjoyed strong coverage in top tier media since its inception with reports being featured in a variety of international broadsheet and broadcast titles including the BBC, CNN, ABC News, Der Spiegel, Les Echos, The Economist, Forbes and Bloomberg to name but a few. Most recently, the CCAF’s Global COVID-19 FinTech Regulatory Rapid Assessment Study, which examined the regulatory reaction to the pandemic, was featured in the Financial Times.
This output and impact has only been made possible by the CCAF’s commitment to establishing longstanding and synergistic relationships with its funders and partners. This is currently illustrated by the foundational funding relationship with the Foreign and Commonwealth Development Office, which spans programmes of research, digital tool development, education and collaboration across the CCAF. And other funding and joint-project relationships have endured for either all or a large part of the CCAF’s life to date, including The World Bank, the World Economic Forum, Invesco, EY, the Asian Development Bank, The Inter-American Development Bank and CME Group.
The ability of fintech and digital financial services (DFS) to extend access to finance for individuals, as well as micro, small and medium size enterprises (MSMEs) is clear. Delivering reduced costs, while improving the resilience and incomes of users, means that technology enabled financial innovation can further directly and indirectly contribute to attaining the UN’s Sustainable Development Goals.