Bank and Non-bank partnerships

Advantages

• Enables central bank to directly supervise banks, without restricting non-banks from design and branding of e-money services.
• Historically used to enable partnerships between banks, telecom operators and fintech.
• May need only limited updates to existing regulations.

Disadvantages

• Lack of direct communication between financial authority and non-bank – may increase risk of undetected operational and consumer protection abuses.
• Requires financial regulator to coordinate with other regulators (e.g., telecom regulator) often in an ad-hoc manner.
• Non-banks require bank approval for new products and services, changes to account limits, etc.
• Telecom operators may use control of telecom channels to restrict access among competitors.