Emerging Themes in Asian Prepaid Regulation

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Presentation at Prepaid Summit Asia 2011, Mumbai India, focuses on financial regulatory issues for prepaid payment instruments with examples from Asia, Asia Pacific and Australia

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Emerging Themes in Asian Prepaid Regulation

  1. 1. EmergingThemes in AsianPrepaidRegulationPrepaid Summit Asia 2011Mumbai, Dec 2011Louise Malady
  2. 2. Overview Prepaid regulatory issues in Asia Examples of different approaches to regulation (regulator and industry) Emerging themes
  3. 3. Asia – Regulatory FocusFrontier/ Emerging Developing Developed Personal  Channelling  Innovation Safety remittance  Competition Financial flows Inclusion –  Legitimate, saf Savings e and cost effective PNG Philippines Australia, Singapore
  4. 4. Common Concern Whatto do when non-banks are proposing to be the issuers of the prepaid value? Regulatory response will depend on local context
  5. 5. Regulations Influence… How business models are structured How agents are used in your model How customers are able to register for accounts How customers can do cash-in and cash- out transactions
  6. 6. Regulatory Focus Safety Efficiency Issuance and  Interoperability Management of the Float  Competition Operational/Security Risks AML/CFT and KYC Agents Consumer Protection
  7. 7. Balance Investment in security by issuers Mitigation of risk - money laundering, terrorist financing and fraud
  8. 8. AML/CFT and KYC Financial Action Task Force (FATF) Tiered KYC (Philippines, Singapore) Financial and Telco Regulators - is there communication between the two regulators? (Fiji)
  9. 9. Agency Arrangements What can non-banks do? Cash-in and cash-out?(Cambodia / Malaysia) Liability of banks and non-banks – is it the same? (Philippines / Kenya) Liquidity and credit risk – mitigate through improved clearing and settlement arrangements (Philippines) Consumer protection and role of agents (Philippines)
  10. 10. Consumer Protection Disclosurerequirements Redress mechanisms Clear identification of users for KYC Consumer education(examples – Philippines and Australia)
  11. 11. Regulatory Focus - Efficiency Interoperability Competition Examples – Australia, Singapore, PNG
  12. 12. Industry Approaches Involve financial regulator early (Philippines, Indonesia) Encourage cooperation with regulator (Cambodia) Encourage cooperation among industry players in working with regulator (Philippines) Seek beneficial partnership solutions(China)
  13. 13. Emerging Themes Prepaid used as savings mechanism Interoperability Regulatory proportionality
  14. 14. Thank Youlouise.malady@yahoo.com

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