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Dear Dr. Demirguc-Kunt, Thank you for sharing this very important discussion that is in progress with us. This is indeed an important area and I wonder if the discussion should not be broadened beyond banks and financial markets to include insurance, mutual funds and pensions as well. There are, in my view, two "mega-trends" that are nearing their conclusion: 1. In a post-biometric / UID / fibre-optic / 3G world cash, credit cards, ATMs, etc. are on their way out and perhaps even the traditional branches with large teller counters and big vaults. It may perhaps be a blessing in disguise (as was the case for mobile and fixed line phones) that developing countries failed to establish the very expensive traditional branch infrastructure despite an enormous policy push to do so. 2. The risk management technologies in all of these different domains are converging rapidly and it is now hard to separate the thinking behind capital rules for insurance from those for banks and securities markets. The product-markets have launched credit insurance and credit derivatives in a domain such as credit once thought of an exclusive preserve of banks. However the older challenges of managing moral hazard, adverse selection, irrational exuberance, fraud remain. Does this imply a fundamentally different design for financial systems that are not quite as product based as they have been historically? Perhaps go closer to the direction that Australia has gone? We are holding a conference in India at IFMR ( in August on precisely this issue so that we can launch a very carefully structured research agenda that will we hope inform policy making in this very broad area. Your inputs and guidance for us as we plan this would be much appreciated. Sincerely, Nachiket Mor