Responsible Finance Forum

Digital Financial Services and Risk Management

Lesley Denyes and Susie Lonie
01 January 2016

This handbook is designed for any type of financial institution offering or planning to offer digital financial services, such as mobile money and agent banking. It could be microfinance institutions, banks, mobile network operators, or third party payment service providers. The conceptual framework for risk and risk management is based on global standards enterprise risk management and best practices (ISO 31000), but the application of principles, illustrations, and descriptions address risks from all perspectives and all types of providers.

The handbook is organized in four parts:

  • Part one provides the conceptual framework for risk management and key elements of the process. It also gives an overall context for DFS risk management.
  • Part two describes the main types of risks faced by DFS providers, including real examples from various markets.
  • Part three introduces the step-by-step process of implementing a risk management framework. It can be used to guide the initial design and deployment of a DFS strategy, as well as how to monitor and manage risks during the ongoing implementation of the strategy.
  • Part four highlights lessons learned by IFC clients across Africa, and considers how digital financial services may change in the coming years and the risks and opportunities DFS present to financial service providers.In addition, the tools chapter provides a full risk database and there is a glossary that can be used as a reference guide when developing a risk management strategy for your institution.