Page 23 - ITU-T Focus Group Digital Financial Services – Interoperability

ITU-T Focus Group Digital Financial Services
Interoperability

5.2.3 Typical functions, activities and composition of the various levels within a NPC

It is crucial that the NPC give fair representation to all the stakeholders of the NPS. These normally include: the
central bank, the ministry of finance, other relevant regulators (e.g. telecom regulator), the commercial banks,
the non-bank financial institutions, non-bank PSPs, the PIPs (e.g. clearinghouses), and the users (including both
major initiators like the national treasury as well as consumers). In some cases, the competition authority and
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the ID authority have also been invited to join NPC discussions, and to participate in specific development/
implementations.

The composition of the NPC should nevertheless be consistent with the objective of having effective discussion
in the meetings. Therefore, in most cases having all individual players being represented in the NPC will not
be possible. However, it must be ensured that all interests are fairly represented both across the different
categories of stakeholders (e.g. banks and non-bank PSPs) and within each category (e.g. large and/or traditional
players vs. small and/or new players). In the specific case of the thematic working groups, these may or may
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not be composed of the totality of the institutions represented in the higher levels of the NPC.
The typical functions/activities of the three levels within a NPC are as follows:

High-level council

• NPC governance
• Setting the overall strategy and key policy decisions (including prioritization)
• General oversight of reforms (e.g. review and approval of action plans, review of progress)

• Final approval/endorsement of guides and rulebooks
• Review any other high-level issues related to implementation.

Although there is no set standard, a high-level council meets at least on a quarterly basis. Meetings may be
more frequent in the early stages of a major reform effort, or at critical stages during its implementation.

Strategic Committee

• Coordination and general quality control
• Prepare general and detailed action plan for the reform and its key individual components
• Monitor progress and problems at a detailed level (e.g. technical obstacles, timeline, etc.)

• Provide guidance to activities of the thematic working groups
• Prepare and vet its reports before submission to the high-level council
Although there is no set standard, a steering committee meets normally on a monthly basis.

Thematic working groups

• Deal with actual implementation of the individual components of the reform effort (e.g. on DFS,
interoperability, new infrastructures, etc.).

• Define the technical standards, service standards, minimum technical requirements, identify obstacles
and other features of each new system and service

• Propose a timeframe for implementation and define progress indicators
• Prepare progress reports on the individual components for the Steering Committee

13 Many NPCs also include institutions that are relevant for securities clearing and settlement, such as the stock exchange, the
central securities depository(s), and securities brokers-dealers.
14 In this last regard, according to World Bank experience having industry associations in the NPC only (i.e. without direct repre-
sentation of individual market players is often ineffective). Individual market players generally do not want to delegate relevant
decisions to their associations, and/or associations may not always be fully representative of the interests of all their members.

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