Secretary of State Payet, Governor Abel, Governor Atalina, Governor Ariff Ali, Vice Chair of the AFI Board of Directors, Governors and Deputy Governors, Professor David-West, members from Africa and from the Pacific Islands, dear partners, friends, colleagues, and distinguished guests – welcome.
I am delighted to welcome you all to the 12th African Financial Inclusion Policy Initiative (AfPI) and 8th Pacific Islands Regional Initiative (PIRI) Leaders’ Roundtable.
First and foremost, I would like to express my gratitude to the Government and to the Central Bank of the Republic of Seychelles, for making this beautiful place home during this week. We are truly privileged to enjoy your hospitality.
Let me also use this opportunity to deliver the congratulations of the AFI network to you as today is the Independence Day of the Seychelles – a country that became an independent republic within the Commonwealth on June 29, 1976.
Today is also the second most important Muslim religious holiday “eid al adha”. I am mentioning this to recognize those Muslim members who are with us today.
I want to appreciate Governor Caroline Abel for her great leadership in the AFI network over the past years. We met for the first time in Lima/Peru at the WB/IMF Annual Meetings in 2014, and ever since I was able to witness an increasingly strong presence and leadership of the Central Bank of Seychelles in AFI. I believe it is fair to say that you stand out as a shining example of the power and value of women’s leadership in the AFI network. We at AFI are convinced that gender-diverse leadership contributes significantly to more inclusive and representative views and decisions. And it produces more informed and effective policies. We are indeed delighted that both AFPI and PIRI Chairs are women: a powerful indicator of progress.
Thank you for hosting us and jointly organizing this unique cross-regional dialogue between African and Pacific peers, the representatives of the AfPI & PIRI. You are the first country ever to host two different AFI regional gatherings simultaneously.
And there could be no better venue for our cross-regional discussions than the Seychelles, a country that throughout its history has been open to the world and to new ideas, and which has seen migration and facilitated the exchange of insight between Africa, the Arab Region, Asia and Europe over centuries. Throughout the country has been an international meeting point, open to the World. And I believe this is why we are here today.
Refer to Seychelles as a venue for conferences… meeting place for financial inclusion, not only for tourists.
There are clear benefits to two AFI regions coming together. Increasingly, our member countries, wherever they are in the world, face similar challenges. As such, the opportunity to exchange not only with near neighbors, but with peers in other regions, is precious, and I urge you to make the most of it at gatherings like this one. Exchanges like this one here during this year do not take place in the regular gatherings we are all going to, and it is the role of AFI to create new platforms and meeting places that create value for all of us.
In our work, partnerships are an ingredient within the recipe for success. Let me update you that we were able to formalize a project with the African Development Bank’s Affirmative Finance Action for Women in Africa (AFAWA). The four-year project will have a focus on women’s financial inclusion, targeting women owned and women-led SMEs.
We are also pleased to have GSMA, one of our inaugural PPD partners re-engage with AFI following the difficult period of the Pandemic, as a Regional PPD Partner in Africa. Mobile finance has been identified by AFI members as a key driver of financial inclusion. GSMA brings the collective expertise of over 750 mobile operators globally and key providers across the African Continent, with industry data and technical knowhow that is highly relevant to AFI members in the region. We look forward to a fruitful dialogue and knowledge exchange with GSMA in the period ahead.
Coming to today’s meeting, our theme is “Rising above Global Uncertainty – Pathways through Inclusive Innovation.” Innovation is critical to the future well-being of society and to driving economic growth. Through innovating, we solve problems, break down barriers, and speed up progress. But I strongly believe that innovation must be inclusive. Which in our context, means working to create solutions which promote financial inclusion and improve access, usage, and quality of financial services, especially for those at the bottom of the economic pyramid. For example, the implementation of tiered KYC frameworks in Ghana and Tanzania, and the shared KYC utility, a regional initiative implemented by members in the Pacific, has enabled people without acceptable identification documents to access low-risk transaction accounts with set limits, letting them receive and make payments. This has created opportunities for marginalized and underserved communities, including micro and small entrepreneurs, to participate in the financial system and enhance their economic well-being.
Today, across Africa and the Pacific, AFI members are using inclusive innovation to address emerging risks and challenges in the financial sector. I’d like to highlight some notable examples:
I hope this provides a sense of the wide scope, and exciting potential, of inclusive innovation to drive financial inclusion.
But here I must sound a note of caution. In order to deliver on financial inclusion, countries must be committed to it. Today, high inflation, reduced economic growth, energy and food shortages, climate disasters and armed conflicts have combined to form what I call a “polycrisis”.
As a result, central banks are these days under pressure to adopt a narrow focus on monetary and financial stability. We now face the real risk of financial inclusion being squeezed out or deprioritized. Which would be a terrible error. Because it’s important to realise that financial inclusion is not a competing objective to ensuring monetary and financial stability. The exact opposite holds true – financial inclusion is complementary to these objectives. It increases the retail deposit base and the effectiveness of monetary policy transmission. It serves to reduce transaction costs and dependencies on foreign capital, and creates a more stable and reliable funding base. Financial inclusion also plays an important role in crisis mitigation, economic recovery and resilience building, as was demonstrated during COVID and in the aftermath of environmental disasters.
Currently, 1.4 billion adults still remain outside of the formal financial system, including many of the most vulnerable individuals and communities. If we neglect financial inclusion now, it could have a tremendous negative impact on disadvantaged groups: women, youth, the elderly, persons with disabilities, refugees, and many others. It is therefore vital to maintain momentum and guard against complacency. Unless we retain financial inclusion as a key policy priority, we risk losing the impressive gains we have worked so hard to achieve.
Refer to BCEAO/s sixties Anniversary Conference in Dakar in November last year, when three pillars were discussed subsequently. A powerful demonstration of the complementarity that inspires us to work more on bringing out the empirical evidence of the complementary nature of the three objectives. Could also refer to ISIP. But continuity is important.
In conclusion, I want to thank you for being here. AFI operates on the principle that we cannot achieve financial inclusion without embracing the spirit of peer learning, knowledge sharing, and collaboration. By participating in, and contributing to, the AFI platform, you help countries to develop and implement policies that promote inclusiveness for our communities. Through cooperation, by sharing our expertise and knowledge, we can build a more inclusive, stable, and sustainable world.
Let me end by inviting you to our flagship event, the 2023 AFI Global Policy Forum to be held in Manila, Philippines, on 12 – 15 September, hosted by the Bangko Sentral ng Pilipinas. The worldwide AFI network will gather to further document the evolving and critical role of financial inclusion in ensuring monetary and financial stability with empirical evidence.
Once again, let me thank our host, the Central Bank of Seychelles, for making this event happen and allowing us to be here. Thank you all for being part of this journey.
 The KYC utility was discussed and planned for 2020 as a joint project between Pacific Island countries – Samoa, Tonga, Vanuatu, Fiji, Solomon Islands and PNG. Papua New Guinea developed its “IdBox” pilot to foster financial inclusion through strengthened personal identification methods. https://www.regulationasia.com/bank-of-papua-new-guinea-eyes-kyc-utility/