#8d6b16
Narrow Bank
Overview
| ROLE IN DELIVERY OF E-MONEY SERVICE | WHO PLAYS THIS ROLE? | |
|---|---|---|
| BANK | NON-BANK | |
| License to issue e-money | ||
| Direct communication with regulator to request authorization for, e.g., new services or revised transaction limits | ||
| Contractual agreement with customer | ||
| Branding of e-money service | ||
| Delivery of e-money service (directly and/or through agent network) | ||
| Safeguarding customer funds | ||
Narrow Bank
ADVANTAGES & DISADVANTAGES
Advantages
- Offers a clear mechanism for direct central bank licensing and supervision.
- Lower initial minimum capital requirements may facilitate equity investment by non-banks.
Disadvantages
- Minimum capital requirements and certain other prudential requirements may not be aligned well with the business model for e-money business.
Narrow Bank
Country Examples
India
Paytm Payments Bank
Pakistan
Telenor Microfinance Bank, Digital Banks (Framework)
