Page 325 - The Digital Financial Services (DFS) Ecosystem

ITU-T Focus Group Digital Financial Services
Ecosystem

Interoperability between digital finance providers

At the end of 2015, seven markets had achieved some form of interoperability between digital money services.
Over the next ten years, we anticipate that more countries will foster some type of interoperability between
mobile money systems. Some markets may pursue bilateral approaches, while others may create centralized
switching.

This analysis assumes that interoperability, pervasive digital wallets, and biometric identification will be
commonplace. The question facing policymakers is how to structure a system that incorporates these
technological changes to make bulk payment more efficient and effective.

7 Structuring the future

If countries are able to create the assumed changes, financial service providers could pool resources to create
a centralized registry for addressing payments and national IDs. For example, when a payor sends a low-value
bulk payment through the centralized switch, that switch could keep a constantly updated database of national
IDs mapped to the beneficiary’s preferred financial service provider. In that way, the paying agency would need
to know only the phone number or the national ID number to send the payment.

This centralized system could then be available to all players in the digital payments ecosystem. While G2P
payments are the most likely first step toward growing the ecosystems, businesses with financial service
providers could also connect through the same pathway to make salary payments and bulk payments to
vendors.
There are a number of different ways this system could be structured. The most logical would be a centralized,
cost-covering model, similar to what is envisioned with India’s Aadhaar and “JAM Trinity” program.

Figure 3 – Addressing payments

8 Country stories

Peru, Nigeria, and India are all pursuing payment ecosystems that resemble, in some way, this paper’s vision of
an ideal bulk payment system. All three have created centralized switches enabled by national IDS. This section
dives deeper into these three countries. The table below allows people to compare different systems, and to see

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