them have migrated successfully downmarket to serve the poor, whose need for such protection is arguably more acute. one plausible reason holding back the diffusion of micro - insurance is transaction costs, i. e., the cost of selling and underwriting insurance and evaluation of claims in a timely and efficient manner. using traditional channels and processes, insurance companies simply cannot write policies with values below a certain floor without pricing them unrealistically. moreover, micro - insurance is a low - cost, high - volume business ; therefore, scale of economy is crucial for success. currently, only insurance company agents, banks, microfinance institutions, non - governmental organizations and shgs are allowed to sell micro - insurance policies, while a bc is authorized to offer banking services, such as, cash transactions to customers. the bc network could be tapped to increase penetration of micro - insurance and take insurance to the uninsured segments of the country. the concern, however, remains on account of the possibility of mis - selling. tapping technology platforms it has been observed that the product initiatives are usually scaled down versions of the existing products. to enable a successful financial inclusion, innovation of products for the specific needs of the poor is not only necessary but also an essential condition. today, banks can provide a bouquet of financial services through the various networks of agents and branches by leveraging and fine tuning technology platforms. technology holds the key to providing models for efficient delivery of small value transactions in large volumes while reaping economies of scale. the implementation of such effective, scalable and platform - independent technology will help drive down the cost of providing banking services to the poor. further, technology helps in spreading financial literacy both as a delivery channel and as an intrinsic part of the learning process ( e. g., instructional computer ). today, both the service providers and service seekers have a number of technology options, such as, smart cards, micro - atms, atms, mobile technology, aadhaar enabled payment systems ( aeps ), etc. to choose from to provide / seek financial services irrespective of their geographic locations. mobile banking mobile banking transactions have been defined as customers undertaking banking transactions using mobile phones involving credit / debit to their accounts. with the rapid bis central bankers ’ speeches growth in the number of mobile phone subscribers in india, banks in collaboration with telecom companies are seeking to develop an alternate channel of delivery of banking services. keeping in view the issues relating to diversity of network providers in

michelle w bowman : design issues for central bank facilities in the future remarks by ms michelle w bowman, member of the board of governors of the federal reserve system, at the chicago booth initiative on global markets workshop on market dysfunction, panel " design issues for central bank facilities in the future ", chicago, illinois, 3 march 2023. * * * thanks, anil. it's a pleasure to be with you today and to be part of this discussion on how central banks can support the effective functioning of financial markets. 1 financial stability is essential for a well - functioning economy. a financial system is considered stable when its markets and institutions are resilient and able to function even following a severe shock. the federal reserve monitors risks to financial stability and uses its supervisory and regulatory tools to mitigate the risks and consequences of financial instability. during periods of financial system stress, the federal reserve can use additional tools, such as lending facilities and open market operations, to directly support the effective functioning of key financial markets and the flow of credit throughout the economy. the onset of the global pandemic in the spring of 2020 was a severe shock both to financial markets and to the u. s. economy, and the federal reserve responded forcefully to support market functioning and the flow of credit. to address the liquidity strains in treasury and repo markets, the fed directly purchased large amounts of treasury securities and conducted term and overnight repo operations using the fomc's open market operations authority. to address strains in other markets, with the backing of the u. s. treasury, the fed used its 13 ( 3 ) emergency lending authority to establish a number of facilities to support the flow of credit to households, businesses, and communities. 2 the federal reserve also took a number of other actions, including easing terms on discount window lending and supervisory and regulatory actions, to encourage banks to lend and act as market intermediaries. 3 the fed's actions were effective in restoring financial market functioning, but the channels through which they operated varied. significant asset purchases and take - up of the fed's repo operations were required to restore smooth functioning in treasury markets because of the liquidity needs of a wide swath of investors. by comparison, many of the 13 ( 3 ) lending facilities saw relatively limited take - up, but they helped support market functioning and the supply of credit in the targeted markets by offering a backstop and bolstering investor confidence. 4 the pandemic lending programs