Douglas Arner et al on Sustainability, Financial Inclusion and Efficiency: A Trilemma or a Trifecta for the Regulation of Digital Finance? (Banking & Finance Law Review)

"Sustainability, Financial Inclusion and Efficiency: A Trilemma or a Trifecta for the Regulation of Digital Finance?"

Zetzsche, Dirk A; Arner, Douglas W; Buckley, Ross P.

Banking & Finance Law Review

Vol. 39, Iss. 3

Published online: August 2023

Abstract: This article argues that the digital transformation of finance is being driven by the quests for (i) efficiency, (ii) financial inclusion, and (iii) sustainability. These in turn are central to regulatory approaches to digital finance. We argue that - rather than a trilemma - the three factors in fact form a mutually reinforcing trifecta which can be supported and reinforced via appropriate policy, regulation and infrastructure. These three factors are necessarily intertwined: financial inclusion underpins long-term oriented economies, and unsustainable outcomes generate numerous risks for finance.