In May, the CGAP published its study presenting the “Basic Regulatory Enablers for Digital Financial Services”* (DFS).

CGAP is committed to developing financial inclusion through DFS. It has analyzed the regulatory frameworks and measures applied over the last decade in ten countries** in Africa and Asia.

The document reflects the different approaches these countries have taken to implementing the basic regulatory enablers, and extracts conclusions from these experiences. It focuses on four enablers:

1. Nonbank E-Money Issuance: prepaid or stored-value accounts.
2. Use of Agents: use of third-party agents, such as retail shops, to provide customers access to their services.
3. Risk-Based Customer Due Diligence (CDD): a proportionate, simplified CDD for lower-risk accounts and transactions.
4. Consumer Protection: establishing proportionate standards for DFS to guarantee security and confidence.

These are four necessary (though not sufficient) factors in developing digital financial services, which are known to foster inclusive social development.  The document’s conclusions provide some key tips for governments and regulators to lay the foundation for a thriving DFS market.