7 March 2015 < = 46 Central Bank of Yemen issues new mobile banking regulations John Owens. ‘A Yemeni money changer serves a customer at his small shop in Sanaa, (on 11 December 2014, the Central Bank of Yemen (CBY) issued new mobile banking regulations following an almost two-year process of reviews and discussions with the private sector and suppor from USAID, the World Bank, the Consultative Group to Assist the Poor (CGAP) and Deutsche Gesellschaft fr Internationale Zusammenarbeit (GIZ) While there was much debate and a of international expertise that was brought to Yemen to develop this regulation, the central bank sil wanted to learn from other central banks from around the world as well as address some lingering internal concerns. Mansour Rageh, who isthe Deputy Manager for Islamic and Specialist Banks atthe Central Bank of Yemen and the bank's representative to the Alliance for Financial Inclusions (AF) Digital Financial Services Working Group (DFSWG), recently visited the new AFI office in Kuala Lumpur to share hi ‘thoughts on the important role that AFI played in assisting the bank with fralizing these regulations. "This is where being part of really made a cfference for us asa central bank that is focused on balancing financial inclusion aims with safety, soundness and stabily” said Mr, Ragen, “We wanted to make sure that we were able to learn from others and were following best practices.” _-F1 really helped us out by supporting an online peer review followed by knowledge exchange visits to the Philippines and Bangladesh and then a lengthy faceto- {ace peer review with key leaders from some of the most experienced central banks in the world during AFIS Digital Financial Services Working Group meeting in September 2014" — Mansour Rageh, Deputy Manager {forlslamic and Specialist Banks atthe Central Bank of Yernen “The Central Bank of Yemen wanted to create an appropriate regulatory environment that would allow banks that understand ‘appropriate AML/KYC compliance requicements and could offer a broader range of financial services rather than just mabe transfers or payments as well as to buld onthe advantages of mobile network operators which had an established agent network ‘outreach into rural areas, and cramatically mare clients atthe base ofthe pyramid than the bank's cid, They also saw some ofthe ‘mobile network operators have the experience and the technology thatthe banks did not have, which would allow banks to reach scale much more quickly. By allowing and providing the enabling environment for banks and mobile network operators to work ‘together, CBY sees thelr new regulation as a treriendous opportunity to safely and soundly expand tru banking services and deeper financial inclusion access much more rapidly than either player could provide on ther own.‘AYYemeni money exchange employee counts local curency at an exchange office in Sanaa in December 2014 “The two peer reviews with key heads of payment departments ancl other regulators involved in the supervision of mobile financial services from countries including Kenya, Tanzania, Bangladesh, Zambia and Panama provided the Central Bank of Yernen with some ofthe best independent advice based on honest and non partial feedback from peers that workin this field and deal with th Issues everyday, According to Mr. Rage, “Ths helped CBY redefine the terminology that we used in our regulations and helped us to ensure that w were following the best practices” This also helped CBY to consider actual implementation issues especialy in regard to oversee partnerships between banks and mobile network operators based on the experiences from others county regulators who are actively supervising these partnerships and enoney in other countries around the world. Mr Rageh stated: “After the peer review, we added some adeitional risk management requirements for e-money issuers as well as modified some ofthe coneumer| protection requirements” In closing, Me. Rageh noted: "I would lke to express CB's gratitude for AFI's tremendous cooperation and support as we develope Mobile Banking Regulations with areal focus on enhancing financial inclusion in Yemen. The experiences gained from our knowledge exchange visits to AFI member central banks and the peer reviews were immeasurable, We look forward to continuout working with AFI as we work to address financial Inclusion in Yemen ‘Watch: The evolution of financial inclusion in Yernen ‘The evolution of financial inclusion in Yernen ABOUT THE AUTHOR John Owens isthe Senior Policy Adviser, Digital Financial Services & Financial Inclusion Policies, at the Alliance for Financial Inclusion. Follow John on Twitter: @Jvowens, af 21 ithe words hseng organization on ane inchison poly regulon & rmamber- eared rework, we promote te develop evcees based poy solitons tha Improve les ofthe poor trough the power of frantlichsion|wee Management Donor&Partners Careers ContactUs Copyright PrivacyPelicy Termsof Use