+ 1. How this guide can help

This guide can help you analyse your policy options and decide on a path forward. Prior to starting this process, you will have likely:

• Assessed your market
• Learned from global and country experience
• Conducted stakeholder interviews

+ 2. Examples of when to use this guide

• You have a gap that you are trying to address with a new policy.

• You have an existing policy that needs to be updated or adjusted.

Use these steps to help you summarize what you’ve learned so far, analyse your findings, and decide on next steps.

To facilitate this process, we have created a template that covers everything discussed in the guide below in an easy-to-use format.

Download the template (Word) in English and French.

+ 3. Summarise your findings

Return to why you started this process: What is the key challenge that you would like to address?

Based on your work so far, you likely will have developed some preliminary hypotheses around several thematic areas. For each thematic area below, what are three key findings that will affect the feasibility of different policy options?

• Relevant policy objectives and regulation
• Regulatory capacity for enforcement
• Business models of relevant providers
• Expansion strategies for relevant providers
• Impact of regulatory and market factors on inclusion of women and other underserved groups

+ 4. Analyse your findings

In this section, you will analyse your findings above to understand how they stifle or facilitate the growth of your target service. Keep your hypotheses about which policy options might be most appropriate top of mind as you work through these questions.

Following is an example of key questions to ask in the context of efforts to promote inclusive digital financial services (DFS). These questions can be tailored to apply to different policy issues as well.

• What do these findings tell you about the true state of policy and regulation? Of infrastructure? Of the market landscape of DFS in the country? Is it a positive or negative impact? Why?

• What is the impact of these findings on the country’s national objectives related to financial inclusion and digital financial services? Is it a positive or negative impact? Why?
  This will help you understand if the findings highlight a challenge that needs to be addressed or an opportunity that may be leveraged to further the country’s agenda.

• Which segment of the population do these findings impact, and why? Can you measure the impact?
  It is important to note if the findings disproportionately and adversely impact a particular segment of the population (e.g., women, refugees, or the rural population). If so, this is a challenge that must be addressed.

• Do these findings contradict other findings? If so, why? Follow-up questions might include:

  • Is this contradiction a symptom of:

    • A lack of coordination within the regulatory authority?
    • A lack of understanding of the issue at stake?
    • A lack of understanding between the private and public sectors?
    • Something else?

  • Does the contradiction arise from within the same type of stakeholder or between two or three different types of stakeholders?

  • For example, if different departments within the same regulator are providing contradicting findings, this may indicate a lack of understanding of the issue at hand or lack of coordination within the regulator. However, if the contradiction is between private-sector and public-sector entities, this may indicate limited public-sector understanding of the challenges that the market faces or limited private-sector understanding of their regulatory compliance requirements.

• Do your findings help validate or invalidate your initial hypothesis?

+ 5. Shortlist your policy options

Make a longlist

Make a list of the most relevant policy and regulatory options that you identified from global and country experience. Keep in mind the challenges that you would like to mitigate and your specific country or regional context.

Complete the following summary for each policy option under consideration:

• Country example(s). List country and relevant context.

• Standard-setting body/international organization example(s). List standard-setting body/international organization and relevant context.

• Is this model suited or easily tailored to your country or regional context? Yes / No / Unsure

• Does more than one government body need to be involved? Yes / No / Unsure

• At which legislative level would this change likely be introduced? Primary (e.g., Act or Law passed by legislature) / Secondary (e.g., Directive, Regulation, Circular, or other issuance by central bank or ministry)

• For what duration will this policy be stipulated? Permanent / Temporary

• Based on your responses above, do you think this model is easy to implement in the given legal and regulatory context? Yes / No / Unsure

• Does this policy specifically consider the impact on the following historically underserved segments of society is? (Check all that apply.) Women / Refugees / Micro, small and medium enterprises (MSMEs) / Farmers / Youth / People with disabilities / Other (please specify) / None of the above

• Is this policy apolitical? Yes / No / Unsure

• Will it have minimal political resistance? Yes / No / Unsure

• Additional notes

Make a shortlist

Based on your assessment of each policy option above, rank them in the order of most suitable to least suitable.

Remove the least suitable options, then list below the top 4-5 policy models to analyze. Your shortlist should include policy options that:

• Are well-suited and may be easily tailored to your country or regional context;

• May be quickly implemented in the given legal and regulatory context;

• Can be implemented with little or no political resistance;

• Are inclusive and gender-intentional (i.e., policies that are sensitive to the needs of underserved groups such as women, farmers, or informal MSMEs).

Ultimately, the aim is to identify policy options that are effective, efficient, equitable, and implementable in practice.

+ 6. Weigh trade-offs

Whatever approach you take to refining your list of policy options, we recommend being clear about your priorities and deliberate about your process.

For example, we prioritise options that are most likely to benefit women and other historically underserved groups. You will want to ensure that you prioritise policy options that reflect your organisational values and/or country-level frameworks.

Sometimes it can help to use an existing methodology to help structure your discussion. We often reference CGAP’s I-SIP Toolkit when we are weighing tradeoffs in financial inclusion policy.

I-SIP Toolkit

Designed by CGAP, the I-SIP Toolkit provides a useful structure for identifying positive, negative, and neutral interactions in the market, focusing on the impact of a policy model across four broad policy objectives:

• Financial inclusion
• Financial sector stability
• Financial sector integrity
• Consumer protection

The four objectives are considered in relation to one another through what the Toolkit calls “linkages.” The six pairs of linkages are:

• Inclusion ↔ Stability
• Inclusion ↔ Integrity
• Inclusion ↔ Protection
• Stability ↔ Integrity
• Integrity ↔ Protection
• Protection ↔ Stability

By examining the relationship between different pairs of objectives (e.g., inclusion and consumer protection; stability and integrity) in the context of a proposed policy, you can assess whether the relationship is:

• Negative. A trade-off, where progress with respect to one objective is achieved at the cost of the other.
• Neutral. Where progress with respect to one objective has no effect on the other.
• Positive. A synergy, where progress with respect to one objective also supports the other objective.

Tools like I-SIP and the below table can help you to (a) break down complex policy considerations into more manageable units; and (b) visualize how to adjust your policy proposals to maximize potential benefits of your policy intervention.

Tip: While doing this exercise, use as much data as available to quantify, where possible, trade-offs and synergies between different objectives.

+ 7. Present the final options

In this last phase, you will present your customized list of policy options and the justification for them in the format best suited to your audience (e.g., a policy brief or a slide deck).

Here is an example of how you can structure your report:

• Executive Summary
  Present a summary of your findings, policy options, recommendations, and proposed next steps.

• Introduction
  This section describes what you were trying to investigate and why, the activities you carried out to reach your findings, the recommendations contained in the report, and the methodology you used and why.

• International experience
  This section presents the various policy choices made by other countries in similar situations , along with the results. This section is not meant to compare countries on their achievements, but rather to propose policy options.

• Key findings
  This section aims to present the main findings of your investigation. We propose here to gather findings around three topics: 1) Policy and regulation, 2) Business models or market impact, and 3) Identified opportunities. However, depending upon your objectives, you could present your findings in a different way that is better adapted to your goals.

• Policy options
  This section is intended to help policymakers identify regulatory impediments in their country and offer options to address these obstacles. This section includes a menu of policy options. It should weigh the pros and cons of each option and help policymakers and regulators make an informed decision on the best way forward. (Note: We often include “maintain the status quo” as a policy option.)

• Proposed next steps
  In this section, present the various steps you believe should be taken to reach the intended objectives. These recommendations depend upon your audience and should be tailored to help them improve their decision-making, design a policy solution, and/or build capacity. Next steps might include developing an internal learning agenda, scheduling workshops, consulting with stakeholders, and/or revising draft guidelines.

• Annexes
  Annexes should include at the minimum the existing regulations that are referenced in the document and the various stakeholders that you have met.

When presenting your report, be ready to:

• Take feedback and criticism;
• Reference your research on the local context, country examples, standard-setting bodies, and other international organizations;
• Present examples of other countries that have successfully implemented the policy option(s) in question; and
• Summarize the synergies and trade-offs that each policy option will have on core policy objectives (such as inclusion, integrity, stability, and consumer protection in the case of financial sector policy), and propose measures to mitigate the negative consequences of the trade-offs that you have identified.

After receiving feedback on the policy options, reorganize them in order of priority of implementation. Then, develop an action plan for each of the policy options and engage with relevant stakeholders to begin implementation.

Download the template (Word) in English and French.