Regulatory Frameworks Group C

Capital Requirements Country specific Based on the cost of doing mobile money business Central bank should consider balance of factors in determining capital requirements, responsible for using data to anticipate risks Capital requirement should NOT include banks issuing e-money

Designing Credit Frameworks without causing financial fragility Non-bank e-money issuers should not be allowed to provide credit on their own account However, they can do this in partnership with regulated financial institutions Must be underwritten by the regulated financial institution Risk mitigation factors in the form of collateral and credit limits should be adhered to Customer protection should also be catered for

When should regulations be introduced relative to capacity? At start, there should be some recognition of regulatory oversight proportionate to regulators’ understanding of the product and its capacity The process should be consultative and evolving

How do we balance the cost of these requirements with risk minimisation? Principle of proportionality should underlie these considerations Objective of financial inclusion Continuous engagement Market surveillance Learning from other countries

What are the necessary features? Eligibility Internal Controls and Audit Trails Customer protection Accounting system Technology requirements Capital requirements Permissible transactions Transaction limits / KYC Management of float account

What are the common sticking points? Clarification of roles between stakeholders Central Bank as the primary regulator MOU between central bank and telecom regulator Interest payments Transaction limits / KYC Identification issue (cards and registration)