New policy models, Governor Espenilla award backed at AGM

AFI’s Membership Council overwhelmingly endorsed new policy models, updated the Maputo Accord and established a new award to recognize financial Inclusion innovation at the network’s 6^th annual general meeting (AGM) on 8 September 2021.

The policy models – one on financial for micro, small and medium enterprises (MSMEs) and the other digital identify and electronic Know-Your-Customer (e-KYC) – represent over a decade of work and expert knowledge towards making high-quality, high-impact guidance for regulators on key financial inclusion topics.

In a series of polls held over the virtual platform, the vast majority of AFI members approved the Policy Model for MSME Finance, which guides members on key elements in the development and review of MSME finance policies by collating and codifying knowledge products on different aspects of the MSME finance ecosystem. It has identified six comprehensive key pillars that can be adapted to the unique country contexts.

The launch of the policy model comes as global events continue to place extreme pressures on the MSME sector. MSMEs, a vital source of job creation in most economies, have been severely impacted by COVID-19-related movements restrictions, supply chain disruptions and liquidity shortages, causing many to halt business operations or reduce their workforce.

Further reinforcing the network’s commitment to small businesses, the AGM also saw updates to AFI’s Maputo Accord, which was adopted by members in September 2015.

The updated text reflects members’ continued commitment to harnessing potential of the small and medium enterprise (SME) sector in their national economies and enhancing the economic potential of disadvantaged groups, including women, youth and forcibly displaced persons, who have been disproportionately financially excluded from accessing finance and formal enterprises.

The second cornerstone publication to receive AFI’s backing at the AGM was the Policy Model for Digital Identity and e-KYC. It aims to accelerate the use of formal financial services, particularly digital payments and other digital financial services, in line with global standards, including for anti-money laundering and countering the financing of terrorism.

The policy model provides financial policymakers and regulators with guidance based on successful codified approaches applied in AFI member institutions, as well as key lessons and best practices from within and beyond the network.

Innovation award announced

AFI Executive Director Dr. Alfred Hannig also announced that the AFI Awards will be expanded into the AFI Global Financial Inclusion Awards and presented at the 2022 AFI Global Policy Forum.

“The awards will include the Nestor Espenilla Jr. Financial Inclusion Innovation Award. The AFI Awards will be elevated to a global award, and we will include an independent jury for the assessment of the award,” Dr. Hannig highlighted in his annual address to the Membership Council.

Nestor Espenilla Jr. Financial Inclusion Innovation Award, a special award that will be presented in recognition of the late Governor Nestor Espenilla Jr. of Bangko Sentral ng Pilipinas for his leadership in fostering policies that catapulted policymakers and regulators embracing innovations in financial inclusion field.

Governor Espenilla, who passed away in 2019, played a crucial role in bringing AFI to life and developing it into the global leader that it is today. While serving as deputy governor, he led the Philippine central bank as a founding and first official member of AFI.