The world is undergoing an unstoppable digital transformation, affecting every aspect of people’s day-to-day lives.  In almost every respect, these changes are positive – expanding financial inclusion, making it easier for consumers to access products and services in more convenient ways; allowing friends and family to share their experiences instantly; and putting more information in the hands of more people at greater speed. These changes are also impacting governments by increasing transparency; improving efficiency; and creating new opportunities for citizens to connect with their elected representatives.

This new interconnected world is creating boundless opportunities to deliver new benefits to consumers in more efficient ways.  The most successful economies around the world are embracing these changes and promoting the emergence of a strong digital economy. Why? Because modern economies are increasingly consumer-driven.

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Roughly 70 percent of the U.S. economy, for example, is made up of consumer spending.  Given this dynamic, nations that want to drive economic growth and raise living standards need to focus on the consumer.

So what can governments do to harness the power of the digital economy to benefit consumers, reduce the ranks of the unbanked and generate growth?  Plenty. I recommend governments focus on six broad categories of action: 

  1. Promote Innovation: Businesses need the flexibility and incentive to invest in research and development so they can create new solutions, products and services that benefit consumers and break down barriers. Governments should help their business community by adopting education, tax, and intellectual property policies that promote and protect these types of innovation.
  2. Encourage the Free Flow of Data: The growing global commerce in data is creating incredible value for governments and consumers.  However, a rising tide of national data localization policies is threatening those benefits. Governments should resist the temptation to prohibit the free flow of information – it will damage their growth ambitions and hurt consumers in the long run.  The Trans-Pacific Partnership recently negotiated between 12 leading Pacific Rim governments prohibits the adoption of “data localization” and “server localization” policies.  While these provisions aren’t perfect, they’re pointing in the right direction.
  3. Harmonize Policies to Ease Compliance: Innovators are confronted with a patchwork of varying government mandates that make compliance a challenge for even the most sophisticated businesses. Whether we are talking about conflicting state laws or conflicting laws between nations, harmonizing digital commerce requirements in a way that protects consumers while at the same time allowing businesses to invest and grow will maximize macro-economic growth. Business groups and governments should work together in public-private partnerships to further harmonize regulations in an efficient and coherent manner.
  4. Aggressively Combat Cyber–crime: Criminal activity targeted at stealing personal and/or financial information creates billions of dollars in losses every year and erodes consumer confidence. Consumer data theft, malware attacks and cyber-crime are an increasingly global phenomenon. Governments need to increase cooperation to disband these criminal organizations, and impose stronger penalties for cyber-crimes.
  5. Avoid Policies That Lock in Old Technologies:  Outdated laws that lock in old technologies and stifle innovation severely limit progress as well as drive consumers and businesses crazy. Policymakers should strive to make government regulations technology-neutral so exciting new solutions that make lives easier can come to market.
  6. Expand Access to Broadband: Expanding the availability (and affordability) of wired and wireless networks to underserved areas will help reduce the ranks of the unbanked in bold new ways.  Mobile financial banking innovations are bringing financial tools to the underserved in ways that we couldn’t imagine before. Governments should work to actively expand access to these empowering technologies.

The digital economy is allowing retailers, banks, restaurants – almost every type of business – to interact with customers in bold new ways.  Exciting new omni-channel solutions are enabling large and small businesses to combine mobile technologies with brick-and-mortar outlets to serve customers in ways that weren’t possible before.  Government leaders should work toward a policy environment that allows this transformation to flourish.

Bill Nuti is an established enterprise and business policy leader who serves as CEO and chairman of NCR Corporation. Previously, he also founded a CEO policy forum on tax reform and competitiveness. 

The views expressed by authors are their own and not the views of The Hill.