AFI response to G20

AFI welcomes the commitment of the Group of 20 (G20) nations to financial inclusion shown by their development of ‘Principles for Innovative Financial Inclusion’, announced at the Leader’s Summit in Toronto, Canada. The Principles form the basis of a concrete action plan to ensure increased access to financial services for the world’s poor through innovative approaches including mobile phone financial services, correspondent banking, improved consumer protection and financial identity initiatives.

AFI – a member network of financial regulatory bodies in developing countries, including central banks – is especially encouraged by the inclusive outreach approach taken in the development of the Principles, which sought concrete input from both G20 and non-G20 nations, enabling the voice and perspectives of developing countries to permeate this important global debate.

“From mobile phone financial services in Kenya and the Philippines, to programmes to increase consumer protection in Malaysia, to financial identity initiatives in Indonesia, developing countries are pioneering some of the most innovative approaches to financial inclusion. Listening to and learning from developing country experience represents a new approach to development that will be fundamental for the success of any G20 financial inclusion initiative,” said AFI Executive Director Alfred Hannig.

The ongoing G20 commitment to increasing financial inclusion through innovative approaches builds on pledges made at the Pittsburgh Summit in September 2009 to improve access to financial services capable of reaching the poor. The Principles derive from the experiences and lessons learned from policymakers around the world on innovative policy solutions. Recognizing the need to take account of individual country contexts, the Principles underline leadership, coordination and innovation as central to comprehensive, country-led financial inclusion strategies.

AFI served as an advisor to the G20 team that worked on the Principles, with other experts including CGAP, a policy and research center dedicated to access to finance for the world’s poor based at the World Bank, as well as other development organizations, standard setting bodies and private sector groups. Supporting the input of developing country perspectives into the drafting of the Principles, AFI facilitated dialogue with leaders of developing country central banks and financial regulatory bodies. Findings from AFI’s survey of financial inclusion policy in developing countries – carried out among its network during 2010 – also informed the development of the Principles. The draft Principles were discussed with a wide range of stakeholders, including the G24, OECD, UN and the Windsor Group.

“The Principles provide a solid basis for the G20’s further development of concrete actions to increase access to financial services for the poor. The G20 is in a unique position to convene and develop broad consensus among stakeholders on such action, and provide political and financial support to help realize national goals on financial inclusion,” Hannig said.

As the G20 accelerates efforts to translate the Principles into practical and concrete actions on financial inclusion to be presented at the Korea Summit in November 2010, AFI will continue to facilitate dialogue, provide advice and act as a platform to leverage the developing country voice within the debate.

Notes to editors:

• 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.
• The Alliance for Financial Inclusion (AFI) is a global network of developing country financial policymaking and regulatory bodies, including central banks. AFI provides its members with the tools and resources to share, develop and implement their knowledge of financial inclusion policies. We connect policymakers through online and face-to-face channels supported by grants and links to strategic partners, so that policymakers can share their insights and implement the most appropriate financial inclusion policies for their countries’ individual circumstances. AFI is administered by the GTZ (German technical cooperation) and funded by the Bill & Melinda Gates Foundation.

For more information please go to: www.afi-global.org. For more information, please contact: Beth Magne-Watts |Alliance for Financial Inclusion (AFI) | m +66 (0)81 916 7300 | e beth.watts@afi-global.org