Press Release: Southern and Eastern African Central Bank Officials Discuss the Mobile Financial Services Business and its Regulation
February 14, 2014Press Release No. 14/60
February 14, 2014
Central bank officials from across Southern and Eastern Africa and international experts discussed various aspects of the mobile financial services (MFS) and shared experiences on regulation of this fastly growing business in the region at the seminar on Mobile Financial Services: the Business and Regulation held this week in Mauritius. The event was organized jointly by the International Monetary Fund’s (IMF) Africa Regional Technical Assistance Center for Southern Africa–– AFRITAC South (AFS) and Africa Regional Technical Assistance Center for Eastern Africa—East AFRITAC (AFE).
The seminar was motivated by the rapid growth in MFS, its potential to enhance financial inclusion, as well as significant regulatory challenges. It was led by a team comprising experts from the IMF, the World Bank, the Reserve Bank of India, South African Reserve Bank, and the Africa Mobile Financial Services Policy Initiative (AMPI) of the Alliance for Financial Inclusion.
Participants from Ethiopia, Mauritius, Rwanda, South Africa, Tanzania, and Zambia made presentations on the current state of the MFS business and the regulatory/oversight framework in their respective countries. Building on country presentations, the experts discussed with the participants business models used by the MFS providers, payment system issues, emerging risks generated by the growing scale of the MFS business, and the need for the appropriately tailored regulation and oversight of MFS, including provisions relating to anti-money laundering and combating financing of terrorism.
The regulatory and oversight framework for MFS is still developing. Mr. Googoolye, First Deputy Governor of the Bank of Mauritius, emphasized that in developing this framework it is important to take a comprehensive approach to regulating MFS and involve all the relevant stakeholders in the process. During the discussions of the optimal regulatory architecture, AMPI participants stressed the importance of balancing financial stability and integrity considerations with the need to foster MFS industry growth and financial inclusion of the unbanked population.
At the conclusion of the seminar, Mr. Kramarenko (AFS Coordinator) and Mr. Singh (AFE Coordinator) indicated that the seminar raised the awareness of the importance of cross-sectoral (that is, payment system oversight and banking supervision) and cross-border supervisory cooperation, which is vital for the achievement of safe and sound financial inclusion through MFS. They added that going forward AFS and AFE would facilitate peer-to-peer exchanges and provide further technical assistance to their member countries in the area of mobile banking, including on agency banking supervision.
Thirty-eight central bank officials attended from 19 AFS and AFE member countries: Angola, Botswana, Comoros, Eritrea, Ethiopia, Kenya, Lesotho, Malawi, Mauritius, Mozambique, Namibia, Rwanda, Seychelles, South Africa, Tanzania, Uganda, Swaziland, Zambia, and Zimbabwe.
IMF COMMUNICATIONS DEPARTMENT