Deposit Insurance for Digital Finance Products
A growing number of countries are witnessing fast-paced advances in digital financial inclusion, including the emergence of innovative "deposit-like" stored-value products such as mobile money and pre-paid debit cards. This blog series raises awareness on key deposit insurance concepts and issues relevant to deposit insurers and policy makers that are considering approaches to protect customer funds in the context of digital “deposit-like” products.
It is increasingly important to ensure that digitally-stored funds are protected against the failure of institutions offering these products. The indirect (or 'pass-through') approach to deposit insurance is raising questions with big implications for financial inclusion.
Countries have adopted three approaches to addressing digital "deposit-like" products when it comes to including them in the deposit insurance system.
This first post in a new series on deposit insurance and digital financial inclusion focuses on the basic, but not easy question, of how to define a “deposit.”