Government support beyond regulatory support is necessary to ensure alignment with the Level One Project
Use of the Level One Platform: Governments can provide critical early volumes for the system by making benefits and payroll payments electronically, as well as accepting electronic payments.
Supportive Formalization and Tax Policies: Reaching “digital liquidity” requires that merchants, large and small, start accepting electronic payments. Many of these today operate on an informal basis, using cash, with no tax exposure. Government programs should support a “ramp up” to formalization.
Consumer and Merchant Education Programs: Proactive education programs can help instill trust in the system.
Leverage RegTech: Government can leverage and support ‘regtech’, wherein the government applies big data, artificial intelligence (AI), blockchains, cloud computing and voice interface, machine learning, etc. to regulation and compliance processes. Key objectives of RegTech include lower costs of supervision, faster results, and decreased human error.
Support Innovation Through RegLabs: Governments should consider creating RegLabs— live, controlled, test environments to speed up learning and new product/ service availability. They present a great opportunity to support innovations but may require significant effort to implement.
Support Payment Scheme: Regulatory support of L1P schemes requires government recognition of the scheme as legitimate. Regulatory engagement in scheme committees and forums, should the scheme allow it, can also be beneficial.
Next Topic in this Section: Payment Scheme Governance