This presentation highlights some of the digital financial service trends, policy and regulatory issues and examples of digital financial services and the role it plays in financial inclusion in various countries in the Asia Pacific region. This was the opening session of the panel on digital financial services and financial inclusion during the Asia Pacific Regional Forum on Universal Access and Services and Broadband Deployment 2015 in Bangkok, Thailand.

1. Bringing smart policies to life
Digital Financial Services for Financial
Inclusion
John Owens, Senior Policy Advisor, AFI
26 March 2015
Bangkok, Thailand

2. Bringing smart policies to life
Global Financial Inclusion Indicators
Source: Demirguc-Kunt & Klapper (2012), World Bank Policy Research Paper 6025
2.5 billion of adults do not have access to formal
financial system
AFI | Alliance for Financial Inclusion

3. Bringing smart policies to life
Overview of AFI
AFI is a global network of policymakers in developing and emerging
countries
•Founded in 2008, AFI’s goal is to support developing countries to develop
and implement successful financial inclusion policies
•The goal of the AFI network is to accelerate the adoption of innovative
financial inclusion policy solutions, with the ultimate aim of making financial
services more accessible to the billions of people who do not have access
to the formal financial system.

4. Bringing smart policies to life
The AFI Timeline
• 125 Institutions, 95
countries
• Unique Peer Learning
network (working
groups)
• G20 Implementing
partner
• Maya Declaration
• More than 70 tangible
policy reforms
Concept
design
Building
the
Network
Activating
the
Network
Enhancing
Network
value
Policy-
Driving
Network
Transition
Planning
Independence
2008 2009 2010 2011 2012 2013-2015 2015-

5. Bringing smart policies to life
Growing Relevance of
Financial Inclusion Globally
• Financial Inclusion is no longer only a development concern
but a cornerstone of economic development framework and
model
• Ministries of Finance and Central Banks are including Financial
Inclusion in their mandate together with stability and integrity
• Financial Inclusion is more and more understood in a broad
framework including access, usage and quality of a range of
financial services
• Developed countries are increasingly facing financial exclusion
problem
• G20 recognizes the benefits of financial inclusion for inclusive
growth, stability and integrity
AFI | Alliance for Financial Inclusion

6. Bringing smart policies to life
Opportunities
• Growing alignment of interests among governments,
private sector and global community
• Greater understanding on the issues related to financial
inclusion as well as more data
• Recognition of country specific conditions and developing
and emerging country-led approaches
• More open communications with International Standard
Setting Bodies
• Technological innovation and enabling regulatory
framework are driving new digital financial service
models that support financial inclusion
AFI | Alliance for Financial Inclusion

7. Bringing smart policies to life
Benefits & Opportunities of
Digital Financial Services
Source IFC Infographic: Bonny Jennings www.itldesign.co.za IAFI | Alliance for Financial Inclusion

8. Bringing smart policies to lifeAFI | Alliance for Financial Inclusion
E-money Services
Mobile Financial Services
Use of Agents
Key Models of Digital Financial
Services

9. Bringing smart policies to lifeAFI | Alliance for Financial Inclusion
Convergence & Interoperability
Financial
Inclusion

10. Bringing smart policies to life
DFS Policy, Regulatory and Oversight
Proportionate AML/CFT
•Tiered KYC Regulations
E-Money Operator Regulations
Remote Account Opening Rules
Agent Regulations
Interoperability
Fair access to ICT
Security and Fraud Mitigation
Consumer Protection Issues

11. Bringing smart policies to life
Regulatory Coordination
• Telecom operators as financial service
providers & banks as telecom operators
• USSD, Fair Access, Data Security
• Who provides oversight?
• Overlapping issues among regulators
• Coordination is critical and needs to be
improved

12. Bringing smart policies to life
Bangladesh: Mobile-Enabled Agent
Banking Success
AFI | Alliance for Financial Inclusion
Bangladesh Bank’s Role:
 Agent Banking & Allowable
Services
 Eligibility Criteria for Agents
 Allowance of Non-Exclusive
Agreements
 Risk & Operational Issues
 Consumer Protection Principles
 Coordination with BRTC
Results:
 540,000 active agents
 25.2 M registered clients
 12.2 M active clients

13. Bringing smart policies to life
Philippines: Mobile-Enabled E-Money
• E-money regulations clearly
set forth by Bangko Sentral ng
Pilipinas
• E-money issuers under
Central Bank Supervision
• Agent guidelines issued
• Tiered KYC process
• Partnerships promoted with
the financial sector
• Interconnectivity between
financial players, payment
operators and e-money
issuers

14. Bringing smart policies to life
Solomon Islands: Mobile Banking for
Financial Inclusion
AFI | Alliance for Financial Inclusion
Central Bank of Solomon
Islands:
 Agent Banking
Regulations
 Expanded Eligibility
Criteria for Agents
 Tiered KYC Regulations
 Public Private Sector
Dialogue
 Financial Literacy and
the role of the Private
Sector
Results:
 From 80% without a bank
account 5 years ago, 80%
now have access to basic
banking services

15. Bringing smart policies to life
Bringing
smart
policies
to life info@afi-global.org
www.afi-global.org
Thank you!
John.Owens@afi-global.org
@NewsAFI