Alliance for Financial Inclusion brings together central banks and others representing nearly 70 percent of world's unbanked; network will develop and implement policies to reach millions across developing world
NAIROBI, Kenya, Sept. 14 /PRNewswire-Asia/ -- Nearly 100 central bankers and other financial policymakers gathered here today for the official launch of the Alliance for Financial Inclusion (AFI), a coalition of countries from the developing world committed to making savings accounts, insurance, and other financial services available to millions of people living on less than $2 a day.
Research has shown that better access to financial services can fuel economic growth by raising national income via increased savings and investments in poor households as well as in small and medium enterprises. This access also enhances financial stability by injecting formal savings into the system, diversifying the capital base, and providing stability during global downturns. Yet, an estimated 2.5 billion people - over half the world's adult population - do not have access to savings accounts and other financial services.
AFI's global network will enable developing countries to share knowledge so they can more effectively develop and implement policies designed to expand access to financial services. While many of the smartest policies to expand financial access have come from developing countries - such as mobile phone money transfer services in Kenya and agent banking in Brazil - knowledge of these solutions is scattered in pockets around the globe.
"The unique aspect of AFI is that it puts us members in the driver's seat to identify and create solutions to increase the availability and choices of financial services in our own countries," said Tarisa Watanagase, governor of the Bank of Thailand and AFI member. "Since we understand our countries' circumstances better than outside organizations, AFI creates an exceptional forum for us to share policies that work and learn from other policymakers about solutions that work for them."
AFI members gathered in Nairobi this week for the Global Policy Forum, a three-day meeting marking the coalition's first-annual conference. Conclusions drawn at the forum will inform financial sector reforms, which members can consider for implementation in their nations.
AFI members have chosen to focus on six policy areas to increase financial inclusion for their respective countries: agent banking, diversification of financial products and providers, state bank reforms, financial identity, consumer protection and mobile phone banking.
"In Kenya we have pioneered innovative solutions like M-Pesa, a system of money transfer via mobile phones, that other countries can borrow and learn from," said Njuguna Ndung'u, governor of the Central Bank of Kenya and AFI member. "In the same way we share a solution that has worked for us, we are looking to the AFI network to help introduce us to our next big idea, such as using agency models for financial service delivery."
Based in Bangkok, Thailand, AFI is managed on behalf of its members by the German development organization Deutsche Gesellschaft fur Technische Zusammenarbeit (GTZ) GmbH and supported with a $35 million grant from the Bill & Melinda Gates Foundation.
This grant is part of the Gates Foundation's Financial Services for the Poor initiative, which is working with a wide range of public and private partners to harness technology and innovation to make safe places to save and other financial services accessible to poor people in the developing world.
"AFI's peer-to-peer knowledge exchange model is playing a key role in amplifying policy solutions that work," said Alfred Hannig, executive director of AFI. "The most realistic and successful solutions for including poor people in the formal financial system are being innovated among our members in developing countries."
"The demand for financial services - especially savings - is enormous in the developing world," said Bob Christen, director of Financial Services for the Poor at the Bill & Melinda Gates Foundation. "AFI will help foster the spread of new and innovative efforts to deliver these services to the doorsteps of the poor so they can manage life's risks and take advantage of life's opportunities."
About AFI
The Alliance for Financial Inclusion (AFI) is a global network of central banks and other policymaking bodies in over 60 developing countries. AFI provides its members with a learning platform for peer to peer knowledge exchange on financial inclusion policies that work, and grants to help implement them.
http://www.afi-global.org
