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132 Banking L.J. 35 (2015)

handle is hein.journals/blj132 and id is 39 raw text is: 






The New Regulatory Frontier: Building
Consumer Demand for Digital Financial
Services-Part II

                   Ross P Buckley and Louise Malady*
    Digitalfinancial services (DFS) are held out as key financial solutions for
    improving financial inclusion. However, targeted end-users often offer little
    in the way of obvious profitable opportunities and so market forces alone
    are not enough to ensure the supply of services and products which match
    end-users' means, needs or wants. As a result DFS in emerging markets may
    suffer from limited uptake and usage, with consequently little effect on
    financial inclusion. In emerging markets, financial regulators have been
    focusing on supporting the success of DFS largely through institutional and
    regulatory framework efforts. This two-part article argues that financial
    regulators must first work to understand and build consumer demand for
    DFS rather than purely focusing on developing enabling regulatory
    frameworks. This requires a change in mind-set for financial regulators
    who are more familiar with promoting financial stability, safety and
    efficiency. The authors explore this changing role for financial regulators
    and recommend that regulators particularly focus on building consumer
    demand through promoting partnerships in DFS as a means ofpromoting
    financial inclusion. In addition, the authors highlight that partnerships
    introduce collaboration risks and heighten consumer risks; requiring
    regulators to adjust regulatory frameworks to ensure such risks are identified
    and mitigated. The first part of this article, which appeared in the
    November/December 2014 issue ofThe Banking Law Journal, provided
    an introduction to the topic, regulatory background, and a section on
    understanding consumer demand. Part two of this article discusses building
    consumer demand and the authors' conclusions.

BUILDING CONSUMER DEMAND
   Regulators can encourage the development of successful and sustainable

   Ross P. Buckley is Scientia professor of law and CIFR King & Wood Mallesons chair of
International Finance Law at the University of New South Wales, Australia. Louise Malady is a
senior research fellow at the University of New South Wales, Australia. This research is supported
by the Centre for International Finance and Regulation, UNCDF, Standard Chartered Bank,
and the University of New South Wales. The authors would like to thank Jonathan Greenacre
for his helpful comments and Ross Willing, Nicole Mazurek, and Samuel Gerber for excellent
research assistance. All responsibility lies with the authors.

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