Jennifer Chien

“Buy Now, Pay Later” (BNPL) is an innovative credit product that allows consumers to split up the cost of a retail transaction (usually between $50 and $1,000), traditionally into four interest-free installments repaid over the span of six weeks. Seamlessly integrated into the online shopping experience, the product is promoted as a fast, convenient means for consumers to manage their cash flow and avoid high-cost debt. Unfortunately, the “free and seamless” nature of BNPL can pose unforeseen… Show more

“Buy Now, Pay Later” (BNPL) is an innovative credit product that allows consumers to split up the cost of a retail transaction (usually between $50 and $1,000), traditionally into four interest-free installments repaid over the span of six weeks. Seamlessly integrated into the online shopping experience, the product is promoted as a fast, convenient means for consumers to manage their cash flow and avoid high-cost debt. Unfortunately, the “free and seamless” nature of BNPL can pose unforeseen risks for consumers. BNPL currently falls within a legal gray area, with few specific rules that apply to the product. As a result, consumers have little protection from the practices that may cause them harm. This report offers policy recommendations that aim to preserve the benefits of BNPL while addressing the risks that can harm users. Show less

Fintech is increasingly recognized as a key enabler for financial sectors worldwide, enabling more efficient and competitive financial markets while expanding access to finance for traditionally underserved consumers. A critical challenge for policymakers is to harness the benefits and opportunities of fintech while managing its risks, including for consumers. The COVID-19 pandemic further accelerated the widespread transition of consumers to fintech and digital financial services, highlighting… Show more

Fintech is increasingly recognized as a key enabler for financial sectors worldwide, enabling more efficient and competitive financial markets while expanding access to finance for traditionally underserved consumers. A critical challenge for policymakers is to harness the benefits and opportunities of fintech while managing its risks, including for consumers. The COVID-19 pandemic further accelerated the widespread transition of consumers to fintech and digital financial services, highlighting their significant benefits while also demonstrating how risks to consumers can increase in times of crisis and economic stress. This policy research paper (1) identifies a range of consumer risks posed by fintech, focusing on four key fintech products (digital microcredit, peer-to-peer lending, investment-based crowdfunding, and e-money) and (2) discusses consumer protection regulatory approaches emerging internationally for policymakers to consider when developing regulatory policy to target such risks. Examples of regulatory approaches are drawn from country examples and international literature. The paper also discusses a range of implementation considerations. Show less

Around the world, financial sector supervisors are experiencing a profound shift to data-driven supervision enabled by the next wave of technology and data solutions. While technology and data are not new to financial oversight, their specific application to financial consumer protection and market conduct supervision has become more widespread and sophisticated in recent years. Expanding on the World Bank’s 2018 note on supervisory technology, or suptech, this technical note catalogues a range… Show more

Around the world, financial sector supervisors are experiencing a profound shift to data-driven supervision enabled by the next wave of technology and data solutions. While technology and data are not new to financial oversight, their specific application to financial consumer protection and market conduct supervision has become more widespread and sophisticated in recent years. Expanding on the World Bank’s 2018 note on supervisory technology, or suptech, this technical note catalogues a range of specific solutions that financial authorities are deploying to help increase the efficiency and effectiveness of market conduct supervision. The technical note identifies four categories of suptech solutions (regulatory reporting, collection and processing of complaints data, non-traditional market monitoring, document and business analysis) and provides concrete examples of 18 different suptech solutions for market conduct supervision, drawing from the experiences of 14 financial sector authorities worldwide. The note also discusses implementation considerations and enablers of successful suptech adoption commonly experienced across countries. Show less

This technical note provides practical guidance to policy makers seeking to develop key facts statements (KFSs) for consumer credit products. Disclosure and transparency are the cornerstone of financial consumer protection. Misleading advertising and incomplete or confusing information on a credit product’s fees and risks can lead consumers to choose products not well-suited to their needs, leading to potential harm to consumer welfare. KFSs are a vehicle to provide key information on total… Show more

This technical note provides practical guidance to policy makers seeking to develop key facts statements (KFSs) for consumer credit products. Disclosure and transparency are the cornerstone of financial consumer protection. Misleading advertising and incomplete or confusing information on a credit product’s fees and risks can lead consumers to choose products not well-suited to their needs, leading to potential harm to consumer welfare. KFSs are a vehicle to provide key information on total costs, fees and charges, and key terms and conditions in a clear, easy to understand manner and in a standardized format across the industry. The technical note shares key principles, international good practices, and lessons learned in developing KFSs and pre-contractual disclosure requirements, including design elements and behavioral insights that can increase the effectiveness of KFSs in achieving better consumer comprehension. Show less

China has achieved remarkable success in financial inclusion. China’s rate of account ownership – a basic metric of financial inclusion – has increased significantly in the past two decades and is now on par with that of other G-20 countries. Traditional financial service providers have dramatically increased the reach of the formal financial sector, including through the world’s largest agent banking network. China has also been an established leader in the fintech revolution, with new… Show more

China has achieved remarkable success in financial inclusion. China’s rate of account ownership – a basic metric of financial inclusion – has increased significantly in the past two decades and is now on par with that of other G-20 countries. Traditional financial service providers have dramatically increased the reach of the formal financial sector, including through the world’s largest agent banking network. China has also been an established leader in the fintech revolution, with new technology-driven providers transforming how millions of Chinese consumers make payments, borrow, save, invest, and insure themselves against risk. This report examines in detail China’s approach to financial inclusion over the past 15 years. The report benchmarks China’s progress against peer economies and analyzes key developments and factors in China’s financial inclusion experience. The report also outlines remaining challenges to achieving further advances in financial inclusion in China, and distills key lessons policymakers from other countries can learn from China’s experience. The report was written jointly by the People’s Bank of China (PBOC) and the World Bank Group. Show less

China has made significant progress in financial inclusion. High levels of account penetration, savings, and usage of payments services have been achieved, largely due to extensive branches and access points (particularly a vast network of rural cash withdrawal points), innovations by non-bank payment providers, and expansion of government-to-person transfers and bankcard programs. Account penetration in China is quite high, with estimates ranging from over 80 to 90 percent, which compares well… Show more

China has made significant progress in financial inclusion. High levels of account penetration, savings, and usage of payments services have been achieved, largely due to extensive branches and access points (particularly a vast network of rural cash withdrawal points), innovations by non-bank payment providers, and expansion of government-to-person transfers and bankcard programs. Account penetration in China is quite high, with estimates ranging from over 80 to 90 percent, which compares well to the EAP regional average but is lower than the high-income country average. The rapid growth in fintech has led to millions of previously underserved mass retail consumers accessing lower cost and better tailored financial products and services.

Despite impressive progress, challenges remain in reaching the “last mile” and providing a wider range of financial services. In particular, access to credit and insurance products is lacking for individuals and micro and small enterprises (MSEs) that are technically “banked”, but still underserved. Actual usage of financial services such as transaction accounts could also be improved, especially among rural residents.

Expanding beyond the current achievements in financial inclusion requires a more modern conceptualization of financial inclusion. Many stakeholders still believe that financial inclusion means promoting credit to the rural poor via subsidized approaches and preferential policies. To date, the gains in financial inclusion in China, while substantial, have been primarily driven by government mandate and encouragements. To achieve high levels of financial inclusion over the long-term requires a commercially sustainable approach, where providers are internally motivated by market-based principles. Show less

Over the past decade, financial consumer protection has become an increasingly mainstream priority for policymakers. A strong consumer protection regime is key to ensuring that expanded access to financial services benefits consumers, enabling them to make well-informed decisions on how best to use financial services, building trust in the formal financial sector, and contributing to healthy and competitive financial markets. The World Bank’s Good Practices for Financial Consumer Protection… Show more

Over the past decade, financial consumer protection has become an increasingly mainstream priority for policymakers. A strong consumer protection regime is key to ensuring that expanded access to financial services benefits consumers, enabling them to make well-informed decisions on how best to use financial services, building trust in the formal financial sector, and contributing to healthy and competitive financial markets. The World Bank’s Good Practices for Financial Consumer Protection (the Good Practices) was developed in 2012 as a contribution to the emerging global set of tools on financial consumer protection. Since then, international guidance and country practices regarding financial consumer protection have substantially evolved. The 2017 Good Practices is designed to serve as a comprehensive reference and assessment tool for policymakers that consolidates the latest research, international guidance, and country examples. A thorough update of the previous edition, this guide expands upon priority areas such as supervisory techniques, effective disclosure, and digital finance, and also emphasizes the practical considerations and tradeoffs that policymakers face when implementing new policies and practices. Show less

This Technical Note analyzes the state of financial inclusion in Russia using a systematic approach. Financial inclusion is increasingly being defined as access to, and usage of, a range of appropriate financial products and services, delivered in a responsible and sustainable manner to unserved individuals, microenterprises, and SMEs. This comprehensive conception of financial inclusion acknowledges that multiple elements must work together to achieve a long-term, sustainable level of… Show more

This Technical Note analyzes the state of financial inclusion in Russia using a systematic approach. Financial inclusion is increasingly being defined as access to, and usage of, a range of appropriate financial products and services, delivered in a responsible and sustainable manner to unserved individuals, microenterprises, and SMEs. This comprehensive conception of financial inclusion acknowledges that multiple elements must work together to achieve a long-term, sustainable level of financial inclusion, including the business case for providers and appropriate consumer protection for consumers. Achieving this conception of financial inclusion also requires an underlying foundation of an enabling legal and regulatory framework, adequate financial and ICT infrastructure, and stakeholder commitment. Show less

This report contains the findings and recommendations from a World Bank mission to Zimbabwe between July 14 and July 25, 2014, which took place for the purposes of a diagnostic review of the Consumer Protection and Financial Literacy (CPFL) laws, institutions and practices applicable to regulated financial services in Zimbabwe (CPFL Review). The banking, non-bank credit institutions, insurance, securities and pensions sectors were considered along with financial literacy programs in Zimbabwe… Show more

This report contains the findings and recommendations from a World Bank mission to Zimbabwe between July 14 and July 25, 2014, which took place for the purposes of a diagnostic review of the Consumer Protection and Financial Literacy (CPFL) laws, institutions and practices applicable to regulated financial services in Zimbabwe (CPFL Review). The banking, non-bank credit institutions, insurance, securities and pensions sectors were considered along with financial literacy programs in Zimbabwe. Four consumer focus group discussions were also conducted with the view of gaining quick and deep insights into people’s knowledge and understanding of financial concepts and products and their attitudes, financial behaviors, and experience in accessing and using financial products and services. The CPFL Review was undertaken in response to a request from the Reserve Bank of Zimbabwe (RBZ) with the support of the Ministry of Finance and Economic Development (MoF), the Securities and Exchange Commission of Zimbabwe (SECZ) and the Insurance and Pensions Commission of Zimbabwe (IPEC). Show less

This technical note assists regulators seeking to establish a financial consumer protection supervision department within the main financial regulatory body of a country. The note provides concrete, practical information and lessons drawn from the experiences of five countries: Armenia, the Czech Republic, Ireland, Peru, and Portugal. It covers topics such as supervisory agenda, organizational structure, supervisory activities, relationship with prudential supervision, and staffing needs.

This report provides concrete recommendations to the Ministry of Finance and Economy (MoFE), the National Bank of Serbia (NBS), and other policymakers on the development of an enabling legal and regulatory framework for commercially-oriented microfinance in Serbia. The scope of this report is on non-deposit-taking microcredit companies (MCCs). The primary focus is on providing international best practices and regional examples with respect to the key components of a new legal framework for MCCs… Show more

This report provides concrete recommendations to the Ministry of Finance and Economy (MoFE), the National Bank of Serbia (NBS), and other policymakers on the development of an enabling legal and regulatory framework for commercially-oriented microfinance in Serbia. The scope of this report is on non-deposit-taking microcredit companies (MCCs). The primary focus is on providing international best practices and regional examples with respect to the key components of a new legal framework for MCCs that are applicable to the Serbian context and adapted to policymakers’ priorities and concerns. Given the fact that a legal framework is only one component of increasing access to finance for MSMEs, the report will also briefly discuss broader topics such as estimating market impact and introducing complementary policy initiatives. Show less

This technical note provides regulators with concrete, practical information on operating price-comparison websites for consumer finance products and the strategic considerations to designing such sites. The note examines price-comparison websites operated by public sector entities in Canada, Hungary, Ireland, Malaysia, Mexico, Norway, and the United Kingdom, comparing differing approaches and highlighting good practices found across countries.

The Agribusiness Regulation and Institutions (AGRI) Index Pilot Report provides preliminary data and lessons learned in developing the AGRI Index and pilot testing in Bangladesh, Kenya, Nepal, Uganda, and Zambia. The AGRI Index provides objective measures of the business environment for the agricultural sector, identifying where obstacles exist in order to build momentum for policy reforms that make operating an agribusiness easier and less costly.

This Focus Note offers practical guidance to policy makers developing disclosure regimes for financial products in low-access environments. “Disclosure regime” refers to regulation, guidelines, and supervision efforts meant to improve transparency by increasing consumer comprehension and market competition. Three main dimensions of disclosure are highlighted:
• Content of disclosure at the consumer level — What information should be disclosed to the individual low-income consumer?
•… Show more

This Focus Note offers practical guidance to policy makers developing disclosure regimes for financial products in low-access environments. “Disclosure regime” refers to regulation, guidelines, and supervision efforts meant to improve transparency by increasing consumer comprehension and market competition. Three main dimensions of disclosure are highlighted:
• Content of disclosure at the consumer level — What information should be disclosed to the individual low-income consumer?
• Methods of disclosure at the consumer level — How should information be disclosed to the individual low-income consumer?
• Disclosure to the public — What information should be disclosed to the public (e.g., other
providers, general consumers, the media, and other stakeholders), and how? Show less