When AFI launched the ERO in October 2020 with support from the Government of Luxembourg, we were in the midst of the Pandemic, we were working remotely, we were facing many unknowns. Yet, in the midst of this uncertainty, we still managed to achieve a great deal. Mention a few of these achievements:
At the global level, AFI members around the world continued to develop and implement financial inclusion policies that are improving lives and livelihoods for millions of underserved people. During the 2020-2022 period, 58 AFI member institutions have reported and attributed 349 policy and regulatory changes to AFI.
These policy improvements have benefitted from knowledge exchange with the Luxembourg ecosystem, and also with the broader European community. A few highlights:
There are more achievements. All deserve mention, but time prohibits from highlighting all of them. Still, it is important to acknowledge many of our friends in the room, with whom we are working to advance our shared mission that seeks to ensure that no one is left behind.
What we see as a result from these engagements is a tremendous opportunity — to build on our converging interests with the knowledge that developed and developing countries can achieve great aspirations by working together and by learning from one another.
This brings us to the outlook of the period ahead. It is a challenging period, in ways that we have not seen for some time.
We face a complex global macroeconomic environment – a polycrisis environment — coupled with the lasting impacts of the COVID-19 pandemic which threaten to reverse several years of progress towards the Sustainable Development Goals (SDGs) including poverty reduction, inequality, and access to education and healthcare.
We also see new risks on the horizon. To the banking sector, to the FinTech sector, and more broadly to financial stability and security. This brings into focus new policy considerations (from Robin’s recent analysis):
While financial inclusion policies can serve as great enablers for broader sustainable development objectives, financial inclusion as a global priority is again fragile. For AFI members financial inclusion policy remains an integral pillar of their financial stability mandate. At the same time we see in some developed countries tendencies to focus on stability at the expense of inclusion. We in AFI believe that financial stability and financial inclusion are not exclusive. They are in fact complementary. Our members continue to tell us this with a view to their jurisdictions, and we know that here in Luxembourg this view is also shared.
What does it take to succeed in such a challenging environment?
The need for innovative policy design to meet these global challenges, and for the development community to be flexible to address emerging priorities.
The importance of reinforcing policymakers’ commitment to develop targeted policy approaches to reach the most vulnerable communities who have been disproportionately impacted by the pandemic and by the turbulent macroeconomic conditions that follow.
The need to focus on usage and quality dimensions of financial inclusion and to consider the connection to progress towards the SDGs, particularly gender, youth, climate, and employment. This has implications for policy design, implementation, and monitoring.
The importance of strengthening collaboration with global Standard Setting Bodies (SSBs) as the integration of technology into the financial sector continually advances, bringing the need for regulatory approaches to digital currencies, AI and other innovations.
Increasing dialogue on convergence between advanced countries and emerging markets, creating more opportunities for global coordination and mutual exchange of ideas.
Reducing the global financial inclusion gender gap! AFI’s commitment remains to support gender sensitive policy work for long term positive change.
Finally, none of this can be addressed by any of us in isolation. We need to work in synergy. We need to learn from one another. We need to stand together, to think together and to believe together.
The fact that we are all here today with the ecosystem so widely represented and so dedicated to our shared goals, tells me that we can do it.
I am excited to continue to strengthen our partnerships here in Luxembourg, where I am now based with my family, and with a highly committed AFI ERO team.
I am grateful for the strong collaboration with the Government of Luxembourg and with all of you.