Reserve Bank of Fiji regional leader in driving national financial inclusion strategy
It is only through a collaborative and cooperative partnership nationally and internationally, were we able to achieve our target.
Reaching the 2.5 billion unbanked individuals around the world has become an international agenda among policymakers and development partners in recent years. Financial inclusion has become a priority and an effective tool for opening up opportunities for the underserved. Financial inclusion has been about integrating the excluded into the formal economy. In doing so, it enables the poor and the marginalised to better protect themselves from economic shocks, improve their wellbeing, whilst contributing to national development and economic growth.
In the Pacific region, we have seven central banks that are working together to drive smart and innovative policies to promote financial inclusion. The Alliance for Financial Inclusion (AFI), global network has enabled the members to share their experiences and learn from each other. The Pacific Islands Working Group (PIWG) was formed by small islands countries in the Pacific, including Fiji, with similar challenges and constraints to work together by sharing their experiences and lessons learned to develop appropriate tools and guidelines. This has enabled the Pacific regional member countries to collaborate to reduce barriers whilst working towards their mission of providing financial inclusion for all Pacific Islanders. The Pacific Islands are pioneering some of the most innovative policies and practices for financial inclusion.
In the case of Fiji, the Reserve Bank of Fiji (RBF) is committed to, and has taken the strategic lead in driving financial inclusion in Fiji. This journey began with a National Microfinance Workshop in November, 2009 to take stock, consult and strategise on a way forward. This collaborative approach has been the corner stone to the success of our efforts in driving financial inclusion. Getting the buy-in from all stakeholders was the very first step in the process. This is when we formulated our first Financial Inclusion Strategy.
A National Financial Inclusion Taskforce (NFIT) was set up as our apex body to formulate, implement and monitor financial inclusion initiatives in the country. Under the Taskforce there are three Working Groups that serve as the engine room for financial inclusion. This model has provided the national platform for effective collaboration between stakeholders from all sectors.
In 2011, the RBF on behalf of the Fiji NFIT made its commitment to the Maya Declaration in four thematic focus areas. These included providing support to NFIT in its goal of reaching 150,000 unbanked Fijians by 2014; integrating financial education into the national school curriculum; comprehensive data upgrade on financial inclusion; and provision for an enabling legislative and regulatory environment. The four broad areas provided the general framework towards which the specific policy actions and initiatives were targeted. At that point in time, we believed these critical areas were the building blocks for having an inclusive financial system in Fiji.
As highlighted earlier, one of the overarching goals was to reach 150,000 unbanked citizens by 2014, a target which was successfully achieved at the end of February 2014. Having an overarching goal with a quantitative target set and agreed to by a wide cross section of national stakeholders has given them the ownership and aspiration to work as a team. To achieve this target, it was essential to have a robust monitoring framework that provided credible information for monitoring and reporting purposes.
As with any other public statement, making a commitment under the Maya Declaration made us accountable which motivated us to work harder to ensure we met our national target. Together with this, coming under the greater network of AFI has also enabled us to learn from peers not only regionally but globally as well. It is only through a collaborative and cooperative partnership nationally and internationally, were we able to achieve our target.
With the term of our first National Financial Inclusion Strategy coming to an end, we can reflect on challenges and lessons learnt along this interesting journey. Establishing baseline data is crucial to the whole process of financial inclusion. This not only provides a snapshot of the current status in a particular country, but it also identifies gaps for policymakers and other relevant stakeholders for policy intervention. The data helps in setting targets and measuring progress by benchmarking it to the original data set. Moving forward, evidence based policy decisions are vital to the formulation and implementation of financial inclusion initiatives in the country.
In this overall process, it is critical to get the support and mandate of the Government from the first day. Government is one of the key stakeholders of financial inclusion agenda. Financial inclusion cannot be addressed in isolation as there is need for a collaborative and cooperative partnership. Having an apex body, like NFIT, that comprises of representatives from all relevant stakeholders will greatly assist in the support and implementation of the strategy.
Commitment to me, in any context, means greater focus and continuity. In regard to commitments made under the Maya Declaration there was a need for us to ensure that we focused on reaching out to the unbanked and the underserved by having an inclusive finance system that serves the needs of all citizens in a country. This we realised would not be an easy journey, but one that can only be accomplished with the national stakeholders buy in and contribution. In all of this we remember that the ultimate end-goal is the lifting of our people out of poverty and what we are doing with financial inclusion is to basically provide a “hand-up” or opportunity to create their own destiny.
In the last few years, we have realised the importance of diagnostic exercises. There is a need to regularly carry out impact assessment of the policies and initiatives undertaken by the respective institutions. Due to constant change, this will enable continuous monitoring of the progress made as well as identify gaps that need to be addressed. An important element in this process is sharing of information with all relevant stakeholders. Information is very powerful however; it quickly becomes obsolete if not disseminated.
Thus, there is a need to continue in engagement nationally and internationally to share and learn from one another. We have only come this far by learning from one another. This process must continue.
Finally, we realise that we have reached the end of our first national financial inclusion strategy but this does not mean the end game for us in Fiji. Later this year we plan on reviewing the progress made and formulating a new set of targets for financial inclusion in Fiji. Whilst we will look at all aspects of financial inclusion, focus would be on the usage aspect as we have noted from our preliminary investigations that usage and scale have been quite low and will definitely be some of the key areas we would like to address with our next national strategy.
Includes representatives from Private and Public Sector entities, Civil Society Groups, NGOs, Micro Finance Institutions, Donor Agencies and Development Partners