1. Mobile Financial Services: Opportunities & Challenges
Regulatory and Policy Level Provisions for Mobile Financial Services Operation
Binod Chandra Shrestha
Assistant Director (Technical)
Nepal Telecommunications Authority
Seminar on
Mobile Financial Services: Opportunities & Challenges
Kathmandu, Nepal
(March 16, 2017)

2. Outline Background Why NTA needs to be involved on MFSs?
Activities of NTA for facilitating Mobile Financial Services (MFSs)
Proposed Procedure to Obtain No Objection Letter from NTA
Regulatory Issues Requiring Clarity
Way Forward
3/16/2017

3. Background Mobile Density: 123.17% including Mobile and LMS
Status of Voice Telephony Service till 16 November, 2016 (Source:
Mobile Density: % including Mobile and LMS
3/16/2017

4. Background
If you want to connect people , if you want to include people, the best means is mobile.
The government wants the unbanked to be banked, the best means is mobile. Using mobile we can achieve the goal of financial inclusion.
NTA has already realized that mobile platform is the best means.
NTA started developing regulatory framework.
3/16/2017

5. Why NTA needs to be involved on MFSs?
MFSs are based on mobile networks and subscribers of mobile services. As a licenser and regulator of telecommunications including mobile services NTA needs to be involved on MFSs in order to
Set service levels including performance and security
Prevent access restrictions
Provide consumer protection from unsolicited service provision or content
Enforce to provide unbiased, quality access to mobile banking users of MFSPs (PSP/PSO according to NRB guidelines)
Ensure services are competitively and equitably priced
Provide mechanisms for dispute management between PSO/PSO and MNO
3/16/2017

6. Activities of NTA for facilitating Mobile Financial Service (MFS)
Had studied on Mobile Value Added Services including Mobile Financial Service (MFS). That study proposed MFS as a new value added service (VAS) and special guideline to open it as (VAS).
Had published that report as consultation paper to obtain comments/ suggestions or inputs from the concerned stakeholders, experts, researchers and any other interested parties.
Has been consulting different stakeholder and experts to finalize regulation/policy modality for MFS but not finalized yet.
Thinking about Provision of No Objection Letter to MFS providers (MFSPs) to facilitate them.
3/16/2017

7. Proposed Procedure to Obtain No Objection Letter from NTA
MNO may operate MFSs (PSO and or PSP) through its subsidiary company.
MNO shall obtain No Objection Letter from NTA to operate MFSs (PSO and or PSP) through its subsidiary company.
The subsidiary company of MNO shall receive license as per the rules and regulations of Nepal Rashtra Bank.
In case of other MFSPs, those who need to talk to MNO for Financial services using platform of mobile network e.g. SMS, USSD, WAP, GPRS, STK etc. shall obtain No Objection Letter from NTA after getting license from NRB.
3/16/2017

8. Regulatory Issues Requiring Clarity
Role of NTA to establish and facilitate the growth MFSs in Nepal
As the complexity of the MFS regulatory environment that the two sector authorities (NRB and NTA) involved in financial services and telecommunications what type/level of understanding between NTA and NRB is required?
Standardization and Quality Assurance
Security Issues
Opportunities of Telco's while adopting MFSs
Investment of Telco's to provide platform of MFSs
3/16/2017

9. Way Forward
NTA and NRB collaborate closely to develop appropriate regulatory framework for MFSs.
NTA and NRB enter into a formal MoU.
MNOs need to be ready for facilitating MFSs
3/16/2017

10. Thank you for your patience! Suggestions/Feedback are warmly welcomed!
3/16/2017