Page 81 - ITU-T Focus Group Digital Financial Services – Recommendations

ITU-T Focus Group Digital Financial Services
Recommendations

Title of recommendation Standardized reporting on agents
Working Group Consumer Experience and Protection

Theme Agents
Audience for recommendation Regulators

Regulators should require DFS providers to submit standardized electronic reports on agent onboarding, trends,
sanctions, and bans that will enable the regulator to spot trends in the development of the agent business and
emerging risks that could be subject to supervisory action. Data from such reports (with appropriate accuracy
and privacy safeguards) can serve as the basis for a negative registry of blacklisted agents or similar report com-
piled by the regulator and distributed periodically or accessible to DFS providers. Regulators should also conduct
regular checks on provider oversight procedures (e.g., field audit, mystery shopping).

Having regular reports on agent performance and practices is necessary to ascertain the current state of
the market, and determine whether additional guidelines are necessary to protect clients on an ongoing
basis. Supervisors should establish a standardised reporting framework that, while not overburdening the
provider, enables the supervisor to fulfil specific and clearly articulated purposes, such as: identifying agent-
related consumer issues; DFS provider-related agent issues (i.e., lack of support and training); monitoring the
relative importance of agents in the eco-system; and spotting trends in the development of the agent business
and emerging risks that could be subject to supervisory action. The G20 High-Level Principles on Financial
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Consumer Protection state that there should be reporting requirements to allow the supervisor to monitor
potential trouble spots or poorly performing DFS providers in the market.

Regulators should require DFS providers to submit standardised electronic reports on agent onboarding,
recurrent agent training conducted by the provider or third-parties, trends related to agents, client and agent
complaints, sanctions, and bans. Data from such reports can help supervisors assess whether an agent network
is operating well, including agent conduct towards clients, and whether the agents are receiving adequate
support from the provider and/or other parties to whom the provider has outsourced certain support and
oversight functions. Indeed, agents depend on the support of DFS providers and a recent study by the Smart
Campaign highlights the gap between policies and application, as well as the lack of support from DFS
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providers to address systems and service issues. Agents reported frequent problems with bank servers and
lack of response/engagement/consistent treatment from bank staff. Agents also complained of lack of back-
end support from the agent network managers.

Data from reports (with appropriate accuracy and privacy safeguards) can serve as the basis for a negative
registry of blacklisted agents or similar report compiled by the regulator and distributed periodically or
accessible to DFS providers, to ease agent KYC. Where feasible, the register should utilize advanced identification
technology, such as biometrics, for identifying agents.
Regulators should also conduct regular checks on provider oversight procedures (e.g., field audit, mystery
shopping), to evaluate challenges faced by agents (and agent networks) and take them into account when
reviewing agent performance. For example, a mystery shopping study conducted by the ITU showed that agents
were inconsistent in checking customer identification, in displaying fee charts, and in enforcing transaction
limits.

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