Retail Payment Systems
In the OIC Member Countries
3
compiled cases and sought to establish best practices. They have been largely motivated by the
high diversity in uptake, growth rates, and divergent practices and standards.
We devised a unique conceptual framework that allowed us to collect data systematically and
to provide the indicators that we believe best show, or are proxies for describing, the most
important features of the use of payment systems. Although we were influenced by the
approach of the World Bank in their 2012 report, ‘Developing a Comprehensive National Retail
Payments Strategy’, we determined that the OIC countries had some unique characteristics
that needed to be taken into account. We therefore determined which characteristics of the
economies of OIC Member States are relevant to understanding their retail payment systems
and this brought us to consider the role of mobile payments somewhat more.
Retail payment systems are deeply rooted in legacy banking systems, yet they have a number
of distinct characteristics that have come about as the result of their hybrid nature. In addition
to the normal relationships between depositors and lenders, retailers are participating parties,
rather than merely recipients of monies when they use payment systems. A wider range of
participants are deeply engaged than in some other kinds of banking functions, such as inter-
bank transfer systems, so their motives, powers and capabilities need to be taken into account.
Differences Among Countries
While the OIC is broadly distinct from other groups of nations insofar as its member states all
have significant Muslim populations, they differ amongst themselves in ways that mirror the
broader differences among nations worldwide. Since there is no consensus about which
systems might be most appropriate by any standard criteria, these differences are neither
surprising nor are they, in themselves, indicators of particular problems. Only by deeper,
contextualised analyses can we see that in some cases the absence or slow dissemination of
particular technologies, institutions or procedures indicates something about the governance,
preferences, capabilities or access to modern payment systems.
In the tables below, which are further explained in chapter 5 of the report and extended in
Annex 2, we summarise the main differences among the eight case study countries. Here we
can see not only a diversity of means of using retail payment systems but also a range of
experiences that are relevant. While in a few countries, such as Great Britain, most or even all
of these methods might be used, this has come about not because the full range of forms is
necessary but rather because first-movers in largely unregulated business sectors tend to
experiment and compete and consequently pass through a period when alternatives systems
have fought for dominance.