Supervision of Banks and Nonbanks Operating through Agents

Categories : Regulation and Payment System Governance, Regulation of Digital Financial Services


Author: CGAP

To date, limited research has been undertaken about how providers identify, classify, and manage risks related to the use of agents and how supervisors assess providers for that matter. Further, this is an area that continues to develop rapidly alongside the dynamic path of evolution of financial inclusion through digital means and the increasing types of institutions for which supervisors are becoming responsible. At the same time, supervisory resources are a constraint in many developing countries where agents are being used in increasing scale. This paper therefore provides an early attempt to help supervisors implement an effective risk-based approach to agent supervision that considers the linkages among the main policy objectives of financial inclusion, stability, integrity, and consumer protection.