Regulation of Digital Financial Services

Around one-half of the global adult population, about 2.5 billion people, do not have a bank account.  One billion of these people in poorer countries do, however, have access to a mobile phone.  Mobile money – using your mobile phone to pay bills, remit funds, deposit cash and make withdrawals using e-money issued by banks and non-bank providers (such as telecommunication companies) – can allow many of these unbanked people to access financial services.  People are unbanked due to barriers such as the cost of an account, the travel required to reach a bank branch or simply not having the identification required to set up an account.  Mobile money can eliminate these banking deserts and grow financial inclusion.


The expansion of mobile money services throughout the world in recent years has been phenomenal.  Mobile money is now available in most developing and emerging markets. The World Bank estimates that by 2020, mobile money could reach 2 billion currently unbanked people.


Mobile money not only provides financial access for the unbanked, it also reduces the chances of money going missing in transit. This is a huge win for government payments. In Afghanistan, government employees had been losing 30% of their salaries to ‘sticky fingers’. A pilot mobile money program gave these employees an effective 30% pay rise, and ensured they got paid and on-time. By some accounts, up to 40% of welfare payments in India don’t reach their intended recipients.


Financial regulators are working to establish the necessary oversight and supervision frameworks to ensure mobile money is safe and accessible. However, creating the appropriate legal and regulatory environment is a challenging work-in-progress for many jurisdictions seeking to improve financial inclusion.


Our project is providing recommendations to address these legal and regulatory issues.  Our work will provide regulators with a benchmark against which to assess their approaches to designing oversight and regulatory frameworks for mobile money. It will lead to a more consistent and level playing field for institutions operating in these markets and in doing so encourage innovations in payments technologies for the unbanked.


Our project is unique; it is the world’s first and, we believe, only university-based project delving into the regulation of mobile money.


Our focus is on the regions of Africa, Asia and the Pacific.  These regions are leading innovative efforts in digital financial services and are realising the vision of making banking “something you do, not somewhere you go”.


The first stage of our project focusses upon:

  • Appropriate risk-sensitive customer due diligence rules for mobile money;
  • Protection of customers' funds;
  • A regulator’s role in building consumer demand for mobile money; and
  • Regulation on the use agents.



We combine rigorous academic research with a practical understanding of developments in the field. We undertake extensive fieldwork in selected countries, and work directly to assist the central bank, or other relevant regulators, to improve their supervision and oversight frameworks for mobile money and digital financial services more broadly. 



Ross Buckley      CIFR King & Wood Mallesons Professor of International Financial Law, and Scientia Professor, UNSW

Douglas Arner     Professor of Law, University of Hong Kong

Louise Malady     Senior Research Fellow, UNSW

Cheng-Yun Tsang Research Fellow, UNSW


Project Funding

The current, first stage of our project is generously funded by CIFR, UNSW, the United Nations Capital Development Fund (UNCDF), and Standard Chartered Bank.


Advisory Board

We deeply appreciate the input of our advisory board which comprises UNCDF, Standard Chartered Bank, ANZ Bank, the Asian Development Bank, GSMA and the Telecommunications Management Group.

Implementing A Proportionate Approach to Balance Financial Inclusion Benefits and Stability Risks

Dr Cheng-Yun Tsang presented on the panel of "Proportionate Approach for Global Financial Stability Standards" at a Global Conference on "Maximizing the Power of Financial Access: Finding an Optimal Balance between Financial Inclusion and Financial Stability" hosted by AFI and Ba
Originally Published: 
Monday, December 12, 2016