Tuesday, July 14, 2009

Information on the Mexican mobile banking guidelines mean?

It looks as if the first press release that mentioned the Bank of Mexico guidelines was published on the 13 July was the one written by Noel Randewich and published by Reuters. (Read here). Subsequent press, added very little to the Reuters article. (Read here and here, as other examples). A search on Noel Randewich seems to indicate that he is a free lance reporter based in Mexico that have reported on many different aspects, but very little about banking. The analysis and interpretation should therefor be taken with some reservation.

The most interesting quote in these articles is the following:
"The rules stipulate measures to promote competition and inhibit possible discriminatory practices in transferring funds within a bank and from one bank to another," the Bank of Mexico (Banxico) said in a statement. This possibly means that an Operator will be forced to offer mobile banking services with every bank, or at a minimum that an Operator can not stop a bank from offering a service on the network. If any of these are true, the following should be considered:
  • it is extremely short-sighted as it would take away free-market forces and the competitive incentive to launch product quickly
  • it would be impossible to police as the bank have little control over the actions of the Operator, as the Operator is not governed by the financial regulator and
  • it would create extremely complex technological interpretations in order to give substance to the guidelines (for instance the definition of fund transfer, the routing and clearing of transactions etc.)
The articles refer to a statement made by the bank on Monday, but I could not find the original statement and it is thus not possible to comment on the implications, not having had an opportunity to study the statement. I would appreciate any opportunity to see the statement and any of the supporting information.

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