AFI presents responsible digital credit guidelines at Paris seminar
At the invitation of Banque de France, AFI participated at an international seminar for regulators in Paris on 7 February where it shared its latest policy framework on responsible digital credit, which aims to help members develop appropriate legal and regulatory framework to mitigate potential risks that may arise from the provision of digital credit.
The Policy Framework was developed under the African Financial Inclusion Policy Initiative (AfPI) with support from AFI’s Multi-Donor Policy Implementation Facility (MD-PIF), a key funding partnership that comprises Agence Française de Développement (AFD), Germany’s Ministry of Economic Cooperation and Development (BMZ) and Ministry of Finance of the Grand Duchy of Luxembourg.
Digital credit is growing rapidly in East Africa and is expected to extend its growth to other regions in Africa, AFI’s senior policy manager for digital financial services (DFS), Ghiyaz Mohammed explained in his presentation, adding that rapid growth leads to market conduct and consumer protection related issues.
“We are already seeing cases of multiple borrowing and over indebtedness due to rapid growth of digital credit. Members of the African regional initiative (AfPI) recognize this and have developed a policy framework on responsible digital credit,” AFI’s Mohammed said.
Several AFI member institutions were among the participants, including Bangladesh Bank, Bank Negara Malaysia, Banque de la République d'Haïti, Central Bank of Jordan, Central Bank of Sri Lanka, Nepal Rastra Bank, Central Bank of the Russian Federation and Banque Centrale de Tunisie.
“It is important and informative to have AFI’s global policy perspective as part of this seminar, and I am glad that Banque de France is cooperating with AFI to incorporate the network’s policy learnings into its program,” Central Bank of Sri Lanka’s Dunuthilaka Keerthi said.
Also in attendance were financial regulatory authorities from developed countries, including the central banks of the Czech Republic, Spain and Romania. AFI cooperates and shares technical expertise with these institutions under its Developed-Developing Country Peer Learning Workstream, which focuses on convergence topics such as consumer protection, data privacy and enabling ecosystems for inclusive financial technology.
AFD also took part in the seminar and delivered a presentation on financial inclusion.
“AFD is committed to advancing financial inclusion and strengthening the technical capacity of policymaking and regulatory institutions in developing and emerging markets. The cooperation with AFI within the MD-PIF is an important element of this effort,” Marine Lagarde, AFD’s Task Team Leader for Digital Financial Services said.