Page 314 - The Digital Financial Services (DFS) Ecosystem

ITU-T Focus Group Digital Financial Services
Ecosystem

9 Considerations for financial policy makers

B2B payments are difficult to digitize. There are many informal companies, and some businesses that will
generally push back on any digital payments. However, policymakers should consider the relevance and impact
of the following factors that may encourage digital B2B payments tools and services, and help the digital
financial ecosystem as a whole.

• Evaluate factors that make it easier for informal businesses to make digital B2B payments: Countries
are taking a risk-based approach to regulating payments, including, in many countries, creating a tiered
structure for KYC regulations. Poor business customers, as well as consumers/purchasers, can benefit
from the same approach, enabling them to access digital B2B payment tools.
• Examine how subsidized credit for SMEs can motivate adoption of digital B2B payment tools: In many
markets, subsidized credit could provide a strong incentive for businesses to begin moving payments
to digital systems. With a tiered KYC structure in place, subsidized credit could also allow businesses to
progressively formalize as transactions grow.
• Determine feasibility of interoperability: Digital B2B payments are more useful when they are more
widely accepted. As policymakers evaluate the extent to which digital money systems are able to
interoperate, consideration may be given to B2B payments as well as other use cases.
• Monitor the role of e-invoicing: Where e-invoicing has been mandated, digital B2B payment and lending
providers can take advantage of the widespread digitization necessary for even the smallest businesses
to comply. Chile, Brazil, Mexico, and Argentina have begun mandating that businesses issue e-invoices.
The hope is to push businesses to formalize and to pay more taxes. It is too early to know the full effects
of these regulations, however, policymakers may want to monitor outcomes in these countries and the
extent to which they drive digitization of payment and lending.

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