ABSTRACT
The key theme in this chapter is assessing the costs of financial inclusion to a financial system. The chapter will also outline the necessities that underpin a thriving payment system. In discussing these necessities, the chapter outlines the important role that financial regulators need to be play so as to safeguard the market against new risks created within the system at every level of the mobile payment pyramid. The chapter will further expound on how public involvement in the financial system results in the broadening of consumer risk and how the lack of properly developed law governing non-banking institutions can augment the percentage of systemic risk and its effects to the consumer and to the economy. Additionally, the chapter argues that the development of mobile financial services from its initial focus of being merely a mobile-money transfer amenity to offering services such as credit poses a threat to banks, consequently introducing a potential of instability and financial fragility in the economy.
