AFI's GSP and FID Working Groups collaborate on data components for AML/CFT knowlegde products
Members from two working groups agreed at an event co-hosted by the Central Bank of Egypt (CBE) and the Alliance for Financial Inclusion (AFI) to collaborate on Anti-Money Laundering and Counter Financing of Terrorism (AML/CFT).
Financial Inclusion Data Working Group (FIDWG) and Global Standards Proportionality Working Group (GSPWG) will work together to identify common challenges and the use of data analytics to ensure that AML/CFT standards are being applied proportionately for financial inclusion.
“We need to know what the challenges are where data is concerned,” FIDWG Co-Chair Alex Ochan said at the FIDWG and GSPWG Meetings in Cairo, which was held from 11-14 March. He explained that the cross-collaboration could help address a variety of challenges including data gaps, poor data quality and a lack of stakeholder commitment.
Working group members emphasized that correct data points were vital for conducting accurate analysis, particularly amid ever-changing global standards. Furthering this aim, a subgroup – tentatively named GSP-FID – was formed to liaise between the two working groups.
Separately, two new subgroups were created under FIDWG. Financial Inclusion and Climate Change (FICC) Framework was established following significant interest from policymakers and regulators in connecting the dots between climate change and financial inclusion data. Here, the first issue identified was on the need for standardized definitions relating to climate change and green finance. In addition, members said that they wanted to conduct a survey to map financial products and policies linked with mitigating and adapting to climate change. Meanwhile, the AFI Data Policy Model will develop a policy model using existing financial indicators. Its work supports the Alliance’s aims of issuing regulatory and policy guidance based on peer learning, cooperation and a bottom-up approach.
Conversely, two existing FIDWG subgroups – Supply-Side Data and DFS Indicators – will be disbanded after completing their deliverables.
As for GSPWG, the working group confirmed Sayed Mohsin from Da Afghanistan Bank as its co-chair. Elsewhere, GSPWG subgroups endorsed their deliverables in AML-CFT, Basel standards, deposit insurance and non-bank financial intermediaries (NBFI).
RegTech also dominated earlier sessions with discussions held on its use in re-engineering regulatory and supervisory processes as well as in AML-CFT.
“RegTech solutions can free resources for more productive uses, increase competition, improve the quality of supervision, enhance consumer protection and ultimately advance financial inclusion” said Settor Amediku from the Bank of Ghana. He defined RegTech as the use of technology to overcome regulatory challenges.
Amediku also reiterated the need to keep things simple and not overcomplicated, while also emphasising the importance of partnership and stakeholder engagement among RegTech players.
Additional outcomes from the event were later highlighted by GSPWG Chair Ramizul Islam from Bangladesh Bank and FIDWG Member Moise Bigirimana from the National Bank of Rwanda, who welcomed the members to the next series of working group meetings at the upcoming GPF in Kigali, Rwanda.
AFI has six working groups: Consumer Empowerment and Market Conduct (CMEC), Digital Financial Services (DFS), FID, Financial Inclusion Strategy (FIS), GSP and Small Medium Enterprise Finance (SMEF).
Twenty-eight GSPWG member institutions attended the event, while 34 came from FIDWG. Working groups officially meet twice a year: a standalone event and then ahead of GFP.
AFI is the world’s leading financial inclusion organization. It develops tools used to promote financial inclusion, exchanges technical and practical expertise among AFI members while assisting them in formulating reform policies, strategies and implementation mechanisms. The CBE joined AFI in 2013. Two years ago, the two institutions co-hosted 2017 AFI GPF.