To promote financial inclusion through available digital financial services technologies, the board of the Royal Monetary Authority (RMA) has approved the electronic money or e-money issuer rules and regulations.
According to a RMA press release, due to the unique geographical landscape, banks and non-banks in Bhutan face huge challenges to set up actual branches in providing financial services to the last-mile population.
On the other hand, mobile penetration is impressive at 88% while bank account penetration stands at 38%.
Therefore, these e-money rules and regulations will provide the opportunity of deeper financial inclusion in the form of mobile wallet services by Bhutan Telecom, TashiCell, banks and the Deposit taking Micro Finance Institutions (DMFIs).
This set of rules and regulations will empower the RMA to license, supervise and regulate electronic money operations and the licensed e-money issuer who is a legal entity issuing e-money will be responsible for sensitizing and educating the user on use of e-money products across the country.
According to an RMA official, e-money issuers can be either an e-money institution licensed under these regulations or a bank or DMFIs licensed by the authority.
The e-money issuer rules and regulations are also aimed at achieving regulatory objective in overseeing e-money operation to promote the safety and soundness of e-money schemes, and therefore enhance users’ confidence in the usage of e-money.
It will also promote e-money, which means monetary value that is stored electronically such as in the form of mobile wallets, as well as magnetically, and issued on receipt of equivalent Ngultrum for the purpose of being a means of payments that is accepted by a natural and juridical person other than the e-money issuer.
The e-money issuer rules and regulations will ensure that customers of e-money issuers benefit from adequate transparency, fair treatment, and effective recourse.
The e-money issuer rules and regulations will come into effect from this month.
Pema Seldon from Thimphu