Central banks should make sure that postal operators can issue electronic money so that they can offer mobile financial services and help bank the unbanked, according to a report from a United Nations agency.
The UN Universal Postal Union (UPU) says that with more than 660,000 outlets throughout the world, and significantly larger networks than banks in many developing countries, postal services can play a major role in boosting financial inclusion.
More than one billion people in 51 countries already avail themselves of postal banking services - adding up to some $1.6 billion in savings and deposit accounts - but, the report says, this can be significantly improved upon.
To do this, the right legal and regulatory framework needs to be put in place, with central banks in charge. The report advocates the use of 'light' banking licenses for postal operators that offer savings products but not loans, and the ability to open accounts on behalf of banks.
Although their physical networks are their major strength, the UN UPU also wants to help postal services offer mobile-based banking and payments. This requires central banks to ensure that their e-money framework allow posts to participate, as has happened with postal giro centres in West Africa, under the 2006 directive from the regional central bank.
In addition, in order to provide financial services directly and more affordably, without having to go through a settlement bank, and thus to be able to compete on an equal footing, postal operators should be allowed to have direct access to national retail payment systems, says the report.
Alexandre Berthaud, report authors, says: "If only 51 Posts offering savings accounts can bank a billion people, then the remaining postal operators of the UPU's 192 member countries, especially strongly populated ones such as Nigeria, Russia, Mexico, Ethiopia and Colombia, could easily provide a gateway to financially include at least 500 million unbanked people directly or through partnerships with banks."
Read the report here:Download the document now 3.6 mb (PDF File)