Demystifying regulatory concerns for the use of cloud services in mobile money

Cloud services offer a number of benefits to organisations such as economies of scale, flexibility, operational efficiencies and cost-effectiveness. Globally, players in the financial services industry are now adapting their business models to embrace the cloud, and leverage new solutions provided by financial technology providers (fintechs) in order to improve their services and lower their investment costs.

For the mobile money industry, there is need to adopt these technological changes to increase scalability and contribute to bridging the financial inclusion gap in a sustainable manner.

While promising several benefits, the cloud can also introduce risks that need to be understood, identified and mitigated. Currently, there are several misperceptions around the effective and secure use of the cloud which, while relevant, are based on traditional banking regulatory concerns. In some markets, this has led to a prohibitive approach towards cloud computing, which is causing uncertainty among mobile money providers about how to adopt the cloud while adhering to existing legal and regulatory frameworks. This uncertainty ultimately acts as a barrier to using the cloud in a way that will be beneficial to the mobile money industry and its continued efforts towards bridging the financial inclusion gap.

Consequently, the objective of this report is to demystify the regulatory concerns regarding the use of cloud computing in the mobile money industry and to explain how restrictions associated with these concerns can be addressed without prohibiting the use of the cloud.