Financial Inclusion of
Forcibly Displaced Persons
(FDPs)

Financial Inclusion of
Forcibly Displaced Persons
(FDPs)

Forced displacement is one of the most pressing challenges of our time. With the number of forcibly displaced persons (FDPs) estimated at nearly 80million in 2019 globally, the scale of the crisis is impeding progress towards achieving UN Sustainable Development Goals (SDGs) as well as commitments to “leave no one behind.” The protracted and complex nature of forced displacement requires that urgent life-saving humanitarian support be complemented by development action, such as financial inclusion.

Financial inclusion empowers FDPs to cope under extremely difficult circumstances while also meeting their broader, long-term financial needs. Access to formal financial services creates conditions for FDPs to establish coping mechanisms, build self-reliance and resilience, apply their skills and competencies, restore their livelihoods, realize their full potential, and live with dignity. In turn, they can contribute to the economic growth of their host country, voluntarily return home or resettle in a third country.

Specific challenges in advancing policy and regulation for the financial inclusion of FDPs include:

AFI supports peer-to-peer learning on financial inclusion initiatives that can offer the same opportunities for FDPs as citizens or other country residents, but only when adapted and applied appropriately. Successful programs and best practices indicate that it is necessary to carefully tailor approaches while taking the FDP context into account and adding complementary services where needed.

Financial policymakers and regulators in emerging economies are taking significant steps to adopt innovative policy and regulatory approaches in order to financially include FDPs. In the past year, several AFI members, such as Central Bank of Mauritania, Da Afghanistan Bank and National Bank of Rwanda, implemented policy and regulatory reforms that enhanced access to formal finance for FDPs living within their jurisdictions. This is in addition to efforts by other members, including Bank of Tanzania, Bank of Zambia, Bank of Uganda and Central Bank of Jordan, which have championed this issue for several years now.

1
Personis forcibly displaced
every 2 seconds
85%
of the world’s forcibly displaced are in developing
countries

How have AFI members shown policy leadership?

Da Afghanistan Bank - Da Afghanistan Bank simplified KYC requirements that allowed FDPs to open transaction accounts at banks, and MNOs with their Ministry of Refugees and Repatriation (MRR) cards, UN Migration card, UNHCR card, and WFP card. The Central Bank also ensured that FDPs are included in Afghanistan’s National Risk Assessment (NRA) and National Financial Inclusion Strategy.

Bangladesh Bank - Bangladesh Bank provided financial services for the Rohingyas by issuing a circular to financial service providers confirming that photo identity documents generated by the Government of Bangladesh, and UN organizations are acceptable for KYC purposes.

Bank of Zambia - Bank of Zambia granted approval for mobile money service providers to provide MFS (within transaction and balance limits for mobile money and e-money) to refugees who present identification cards or registration documents issued by the Ministry of Home Affairs. These mobile money service providers include Airtel Money, Zoona, Kazan, Zamtel Kwacha, and MTN Mobile Money.

Bank of Tanzania - Bank of Tanzania worked closely with the Government of Tanzania and Financial Intelligence Unit (FIU) on the National Risk Assessment (NRA) to identify risks that can be posed by refugees in the financial system. Establishing the level of risks is important to develop tiered KYC processes and integrate into the second National Financial Inclusion Framework (NFIF 2.0). Bank of Tanzania continuously empowers banks and MNOs to develop products that are suitable for FDPs.

National Bank of Rwanda - National Bank of Rwanda enabled digital cash transfer programs for refugees in Nyabiheke, Gihembe, and Kigeme camps to complement other humanitarian efforts. The Bank work with partners in visiting refugee camps to raise awareness on financial consumer protection regulations, and encourage adoption of cashless means of payment.

Central Bank of Jordan - Central Bank of Jordan included refugees in the Jordanian National Financial Inclusion Strategy (2018-2020). The Central Bank also launched the Jordan Mobile Payments (JoMoPay), its national centralized payment switch that connects refugees to a payment ecosystem comprising of financial and payment intermediaries such as telcos, banks, and transfer companies. JoMoPay offers benefits to refugees as its KYC requirements are uniquely designed for them to use their UNHCR ID number to register, providing refugees with access to a mobile wallet.

The way forward

Where appropriate, FDPs should be given the opportunity to indicate their individual preferences and needs. Displaced communities have an important role to play in designing local solutions to advancing financial inclusion.

Evolving payment landscapes and implementation of digital technologies, including biometrics and distributed ledgers, have the potential to substantially improve compliance, cost efficiency, and accountability for financial inclusion of FDPs.

Risk management should address barriers such as compliance with KYC requirements, and FDP issues within the context of NRAs and AML-CFT regulations is a priority.
Concerted coordination should continue among financial regulators and policymakers, global and regional standard-setting bodies, UNHCR and other humanitarian agencies, and civil society to develop a clear plan of action.

The role of the financial regulator

Financial regulators and policymakers can drive, influence, and facilitate efforts to design and offer formal financial services to FDPs by creating an enabling regulatory environment that fosters innovation yet still ensures sound compliance.

Coordinate with relevant actors to collect data on FDPs and their financial needs

Integrate FDPs into NFIS.

Include FDPs in National Risk Assessments (NRAs) towards implementing simplified CDD for low-risk FDPs

Collaborate closely with key ministries, global and regional standard setting bodies, development and humanitarian agencies, civil society organisations, and the private sector

Improve FSPs’ negative perception of FDPs

Create a regulatory environment to enable FinTech solutions that comply with global standards for financial integrity, stability, and consumer protection.

Adopt digital technologies such as biometrics to substantially improve compliance, cost-efficiency, and accountability for the financial inclusion of FDPs.

Smart policies for Inclusive Green Finance

SDGs

April 2, 2021
Financial literacy transforms refugee livelihoods
April 2, 2021
Financial literacy transforms refugee livelihoods
Bank of Uganda (BOU) has long considered financial literacy a crucial component for enhancing financial inclusion, requiring attention both on a national scale and for targeted vulnerable gr
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November 20, 2020
Financial inclusion elevated at European Microfinance Week
November 20, 2020
Financial inclusion elevated at European Microfinance Week
Financial inclusion was one of the key topics at European Microfinance Week, held on 18-20 November, where staff from AFI’s management unit highlighted various achievements from across the network in addressing the challenges facing consumer protection and savings as well as vu
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August 20, 2020
8th African Financial Inclusion Policy Intiative (AfPI) Leaders Roundtable
August 20, 2020
8th African Financial Inclusion Policy Intiative (AfPI) Leaders Roundtable
Bank of Tanzania and AFI are co-hosting the 8th AfPI Leaders’ Roundtable on 20 August 2020, the network’s first virtual gathering exclusively for the heads of central banks and other regulatory member institutions in the Africa region.
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June 23, 2020
Can NFIS reach forcibly displaced persons?
June 23, 2020
Can NFIS reach forcibly displaced persons?
Forcibly displaced persons (FDPs) must be incorporated into national financial inclusion strategies (NFISs), recognizing their special circumstances and legal status as an important delibera
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June 20, 2020
Forced displacement and COVID-19: Why financial inclusion matters
June 20, 2020
Forced displacement and COVID-19: Why financial inclusion matters
Today, on World Refugee Day, we are reminded that the number of those forcibly displaced remains at a record high. Nearly 80 million stateless people, refugees, internally displaced persons
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June 4, 2020
Locating FDPs in IGF policies
June 4, 2020
Locating FDPs in IGF policies
Formulation and implementation of mitigation and adaptation inclusive green finance (IGF) policies can play a key role in bringing financial inclusion for forcibly displaced persons (FDPs)
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June 20, 2019
AFI rolls out project to advance inclusion of forcibly displaced
June 20, 2019
AFI rolls out project to advance inclusion of forcibly displaced
The two-year project, “Advancing the Financial Inclusion of FDPs: Putting Policy Recommendations to Practice”, is being carried out in collaboration with Germany’s Federal Ministry of Economic Cooperation and Development (BMZ).
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June 23, 2018
Financial inclusion of Forcibly Displaced Persons (FDPs): What is the role of FinTech?
June 23, 2018
Financial inclusion of Forcibly Displaced Persons (FDPs): What is the role of FinTech?
The goal of the Rohingya Project is to create the foundation for a viable economic future for the Rohingya and connect them to opportunities to learn, equip and empower themselves. Learn mor
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June 22, 2018
Advancing the financial inclusion of refugees through an inclusive market system approach
June 22, 2018
Advancing the financial inclusion of refugees through an inclusive market system approach
Most forcibly displaced, in particular refugees, are today excluded from the formal financial sector, which means they lack a safe place to save and receive money, affordable ways to make pa
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June 20, 2018
AFI Member Stories – Country Snapshots from AFRICA: Zambia, Rwanda, Tanzania
June 20, 2018
AFI Member Stories – Country Snapshots from AFRICA: Zambia, Rwanda, Tanzania
To mark World Refugee Day on 20 June, AFI members shed light on their efforts in innovating responsibility sharing, partnerships, and policy actions to advance the
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Newsroom
Advancing the Financial Inclusion of Forcibly Displaced Persons: Case Studies on Rwanda, Mauritania and Afghanistan

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Under the German G20 Presidency, financial inclusion of forcibly displaced persons was set as one of four priorities of the G20 Global Partnership for Financial
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