Financial inclusion strategies (FIS) are comprehensive public documents that systematically accelerate a country’s level of financial inclusion. Typically, national financial inclusion strategies (NFIS) include analysis on a country’s current financial inclusion status and constraints, measurable goals, how and when that country proposes to reach these goals, and how the progress and achievements of the NFIS will be assessed.
A national financial inclusion strategy (NFIS) is a comprehensive public document formulated at the national level to systematically accelerate the level of financial inclusion in each country. Typically, an NFIS will include an analysis of the current status and constraints on financial inclusion, a measurable financial inclusion goal, how the country proposes to reach this goal and by when, and how it would assess the progress and achievements of the NFIS.” An NFIS is developed through a broad consultative process involving, among others, public and private sector stakeholders engaged in financial sector development.
It is not surprising that NFIS have gained traction in recent years, since the logic appears simple: greater financial inclusion promises more inclusive growth and development, while national strategies have the potential to accelerate financial inclusion. Empirical evidence appears to support this position. For example, the South Africa Financial Sector Charter helped increase the percentage of banked adults from 46% to 64% in four years, and six million basic bank accounts (Mzansi accounts) were opened. In the United Kingdom, a Financial Inclusion Task Force contributed to halving the number of unbanked adults through a variety of policy measures. Reinforcing this evidence, the World Bank recently reported that countries that have launched an NFIS have achieved much higher levels of financial inclusion than other countries in recent years. The evidence from countries such as Brazil, Malaysia, Namibia and Tanzania support this assertion. Analysis carried out by AFI and Bank Negara Malaysia has also reaffirmed the positive impact of NFIS.
The growing number of NFIS across all regions shows the influence of knowledge and peer learning on strategy development. However, it is important to note that practices tend to change over time based on how much knowledge is shared through mechanisms such as peer learning, and the extent to which this knowledge is applied in the strategy formulation process. As analysed in the FISPLG publication National Financial Inclusion Strategies: Current State of Practice, assessing the current state of practice of NFIS has other limitations, as well. First, there is no systematic database in place with general data on NFIS or on the specific practices different countries have adopted. Even the scattered data that is available relates mainly to the formulation of national strategies, while very little data is available on implementation and progress monitoring and evaluation. Second, there is no consensus on what should legitimately be included in an NFIS. For example, some countries tend to include macroeconomic development strategies even though these may not significantly or strategically address the core issues of financial inclusion.
NFIS are developed through broad consultative processes involving, among others, public and private sector stakeholders engaged in financial sector development. The growing number of NFIS across all regions shows the influence of knowledge and peer learning on strategy development.
Global trends in financial inclusion strategies include emerging issues such as climate change and marginalized groups. In addition to women, other groups that need to be considered when building national financial inclusion include youth, forcibly displaced persons and people with disabilities.
Fundamental and emerging topics under FIS are explored in-depth through AFI’s Financial Inclusion Strategies Working Group (FISPLG).
A key commitment within the Denarau Action Plan is to “consider and implement best practices in integrating policies for women’s financial inclusion and gender considerations within NFIS” and to “develop knowledge products to support this work”.
FIS commitments are being implemented to ensure that national coordination is driving financial inclusion programs effectively.
|PRIMARY THEMATIC AREA||2012||2013||2014||2015||2016||2017||2018||2019||2020|
Financial Inclusion Strategy
|Maya Declaration Targets||27||33||41||44||48||63||63||81||86|
AFI’s Financial Inclusion Strategy Peer Learning Group (FISPLG)
Policymakers in the AFI network have reached a consensus that National Financial Inclusion Strategies (NFIS) are essential in coordinating financial inclusion policies and ensuring they are based on sound data and the impacts are robustly monitored. AFI’s Financial Inclusion Strategy (FIS) Peer Learning Group promotes the development, implementation and monitoring and evaluation of national financial inclusion strategies.
Nomcebo Hadebe, Ministry of Finance Eswatini
Mackay Aomu, Bank of Uganda
Mohanad Salous, Palestine Monetary Authority
Gender Focal Point
Liza Noor, Bank Negara Malaysia
FISPLG provides practical support to countries that have made commitments under the Maya Declaration and to the G20 through its Financial Inclusion Peer Learning Program.
Inclusive Green Finance Subgroup
Climate change poses risks to financial stability across the globe, but the impacts are more severely felt in developing countries. It affects GDP and economic growth through damage to property and infrastructure, loss of productivity, potential massive migration and severe damage to the agricultural sector while impacting the productive value chain. Although the call for a transition to lower-carbon economies is urgent, its full implementation will take some time. However, financial regulators in developing countries are leading the adoption and implementation of policies to tackle climate change through climate-adaptation and climate-mitigation initiatives that in turn foster greater financial inclusion: Inclusive Green Finance policies. The purpose of this Green NFIS guideline note is to support the AFI member institutions to accelerate the development of inclusive green finance policies to enhance sustainable potential for economic growth and to manage the financial risks associated with the impacts of climate change. It is designed in such a way to provide guidance and directions as AFI member institutions incorporate IGF into their NFIS as Green NFIS. FISPLG members, together with the IGF Working Group will be producing a Guideline Note on “Integrating Inclusive Green Finance in a National Financial Inclusion Strategy” in 2021 which follows the structure of the AFI NFIS Policy Model (2020).
NFIS Current State of Practice Subgroup
Given that fact that the typical NFIS duration is 3-4 years and the fact that AFI’s members have started their NFIS at different time intervals, a 2021 update is due to be able to capture the latest and most relevant updates and developments and compare these with countries which launched their NFIS before 2018, and those which have conducted a NFIS Mid-Term Review between 2018 and 2021. Given the impact of COVID-19 on NFIS development and implementation this Report will also be a timely publication to document various COVID-19 policy responses which are aimed at mitigating the impact of COVID-19 on NFIS. In 2020 FISPLG published the AFI NFIS Policy Model which is a compendium of NFIS good practices and this Policy Model can now be used as a solid framework to effectuate the stocktaking, including the measurement of the existence of cross-cutting or new topics in NFIS such as gender, youth, forcibly displaced persons (FDP’s), Inclusive Green Finance (IGF). The 2021 update will also aim to measure the potential impact of COVID-19 on the different NFIS components and the approaches used to mitigate COVID-19’s impact, to ensure continued NFIS progress and promote fair and equitable access to quality financial services in both the mitigation and recovery phases. While a subsection of this report will specifically focus on the impact of the COVID-19 crisis on NFIS and actions undertaken to mitigate this impact, many of the actions/recommendations will be applicable to another crisis and therefore can considered in current and future NFIS so as to enhance resilience to crises. This update will also aim to measure progress related to other AFI financial inclusion agreements/accords, including the Denarau Action Plan (DAP) commitment 2.
Enhancing Financial Inclusion in Rural Areas Subgroup
In recent years, the use of electronic technology is revolutionizing the provision of rural financial services, including insurance, and is driving down the costs of handling small transactions through branchless/mobile banking and these digitally enabled services and platforms (which bundle financial and non-financial services) are offering many small-scale growers new opportunities to engage in agriculture. Digitization offers the potential to revolutionize access to financial services in rural areas, provide more seamless connection for farmers and rural enterprises to value chains, reduce transaction costs for payments to suppliers, and increase financial resilience, for example through access to inclusive insurance. The increasing penetration of mobile financial services and biometric technologies that has been seen in recent years offers the potential to achieve efficient client enrolment and widespread access to digital payments. In short, digitization is a new frontier in developing vibrant, resilient rural and agricultural livelihoods.
|Events||1st: Abuja, Nigeria||2nd: Bangkok, Thailand|
3rd: Kuala Lumpur, Malaysia
|54th: Nadi, Fiji|
5th: Port of Spain, Trinidad & Tobago
|6th: Manila, Philippines|
7th: Kuala Lumpur, Malaysia
|8th: Dar es Salaam, Tanzania|
9th: Nadi, Fiji
|10th: Dushanbe, Tajikistan|
11th: Sharm El Sheikh, Egypt
|12th: Siem Reap, Cambodia|
13th: Sochi, Russia
|14th: Livingstone, Zambia|
15th: Kigali, Rwanda
|16th: Virtual Meeting|
17th: Virtual Meeting
|18th: Virtual Meeting|
19th: Virtual Meeting
Financial Inclusion Strategy Peer Learning Group (FISPLG) Technical Virtual Meeting discussed the importance of integrating youth and forcibly displaced people in a national financial inclusion strategy followed by country-specific member testimonies and Q&A.- Read More
Financial Inclusion Strategy Peer Learning Group (FISPLG) Webinar on “Addressing the Impact of COVID-19 on Gender Savings Groups” includes discussions on the concept of Gender Savings Groups (GSG), their advantages and disadvantages, the effects of COVID-19 on GSG and measures that can be taken to mitigate these effects. The webinar concludes with participants exploring why COVID-19 policy responses need to be financially inclusive and gender-sensitive.- Read More