Transcripts For CSPAN2 Access To Financial Systems 20170831

CSPAN2 Access To Financial Systems August 31, 2017

In addition, it is hard in the circumstances to be an entrepreneur when you are outside the foremost Financial System. It is difficult to gain access to capital or form a business when you lack basic Financial Services but the good news is that many nations have made commitments to expanding Financial Service services for the poor and they understand that it is vital to Economic Development and social inclusion. As a result, they are developing Financial Inclusion policies and implementing a new framework that encourages inclusion. Today, robin lewis, john and myself are wanting our third annual Brookings Square card metering progress on Financial Access and usage with the support of the bill we have embarked on a threeyear study of inclusion in 26 developing countries. The short summary is that weve seen progress on Financial Services in many places and there are efforts to help marginalized populations and this is happening through mobile money and digital Financial Services. As part of our research we got detailed suggestions from every country and we also talked with many leaders in the Ngo Community who are for Financial Inclusion and were grateful for their support and help along the way. To give you a more detailed sense of the highlights of our study my colleague robin will summarize the key findings and robin is a Research Analyst in a social fellow at brookings with our center for technology innovation. With that, i turn it over to robin. Good morning. Thank you to darrell for those remarks. Our sincere thanks to all of you for joining us this morning either here by lifestream or africans. We are grateful for your interest in the project and im looking forward to providing a brief overview of our approach and key findings for return it over to the panel discussion. First, id like to start with a brief overview of our project. As mentioned, the financial and Digital Inclusion project was launched in the summer of 2014. The purpose of the project was to provide policymakers, privatesector representatives, nongovernmental organizations and the general public with information that can help improve Financial Inclusion and around the world. Why does Financial Inclusion matter . At the individual level Financial Inclusion matters because it provides pathways for people to improve their Financial Health which contribute to their overall wellbeing. Beyond that is a key ingredient in advancing Sustainable Public goals such as Poverty Reduction and gender equality. To support our overall objective over the past three years we have selected a series of politically economically and geographically diverse countries and we have evaluated their progress toward Financial Inclusion through a series of annual reports, as well as conversations with diverse groups of experts. So lets talk briefly about the report that we are launching today. This is the third annual report and as with the first reports we examined access to and usage of formal Financial Services across a diverse country contact. When i say formal Financial Services we primarily focus on basic services, since either the formal system including a savings account, government two person transfers. The 2017 report we have distilled and updated the Country Profiles that we featured in 2015 and 2016. In addition to these selected Financial Inclusion highlights, and updates, we have included some recommendations regarding key next steps for advancing Financial Inclusion. Given the scope of our sample and the rapidly evolving nature of the inclusion around the world these lists are not exhaustive but we do believe they capture an important snapshot of Key Development and opportunity for future growth. So, moving to a quick scorecard interview. As darrell mentioned the components of our report informed by a research on each countrys landscape is a scorecard tool. To develop the scorecard we identified four dimensions of Financial Inclusion including country commitments, mobile capacity, Regulatory Environments and the adoption of formal Financial Services. In terms of our countries sample we maintain the same risk as in the Previous Year in which we added five new countries to diversify our sample. These countries included the Dominican Republic and, egypt, el salvador, haiti and vietnam. We will dive into the dimension level findings very shortly but for the moment here is a preview of the 2017 scorecard. As you can see the top scoring countries are generally distributed across latin america and Subsaharan Africa. Although, countries and other regions including the philippines also demonstrated strong performances as well. For the third euro can you receive the top place on her scorecard, in part due to the robust commitment to advancing Financial Inclusion as well as Widespread Adoption of mobile Money Services. With that said, a number of other topranked countries including several in latin america have experienced lower levels of mobile Money Adoption to date but often have robust takeup of innovative card based services, as well as nontraditional access point such as banking correspondence. We think this finding should be encouraging to the Financial Inclusion community because it demonstrates that countries with different political, economic, and geographic environments can effectively pursue different pathways for advancing inclusion. So, to provide a better sense of what factors inform the scores we will briefly walk through some of the indicators across the four dimensions before we explore our findings. For example, country commitment indicators include these assistance of comprehensive, National Inclusion strategies as well as the specific Financial Inclusion framework for the Consumer Protection framework. These indicators help give us the sense of whether countries are willing to work collaboratively across inspectors to make engagement to just make engagement with Financial Services a priority. Moving to mobile capacity. We measured this because it includes indicators related to mobile infrastructure, as well as the number and type of mobile Money Services that are offered. Now, while Digital Financial extend far beyond mobile money these offerings can provide a very convenient, affordable platform for those who are typically underserved to access Financial Services. Moving briefly to Regulatory Environment. We look at whether regulation, policies or other guidance concerning electronic money and other forms of digital Financial Services have been issued. We also looked at issues such as mobile money platform interoperability which basically means whether customers of one service can easily send payment to customers of another mobile money service. Finally, moving to the adoption indicators we focused on account adoption with both more traditional Financial Service providers as well as mobile money providers across underserved groups in particular. These groups may include lower income adults as well as women. All the data in this set is from the World Bank Global index database and we look forward to updating the data as a new data set is revealed. Moving to the key findings. First, lets begin with the country commitment to mention and touch on a few examples of country progress. For example, mexico increased its overall score by five Percentage Points this year to join the top five scoring countries. A couple of the changes that prompted this increase include that in june of 2017 the National Council on Financial Inclusion released the national Financial Inclusion plan. The government of mexico also joined the United Nations based better than cash alliance. Moving to mobile capacity, el salvador is a example of a country that increased its core by five Percentage Points over the last year partly by increasing adoption of smart phones which can provide a more convenient and accessible way for individuals to access mobile Financial Services. Moving to Regulatory Environment, countries from across all of our major region had strong performances on this component of the scorecard including peru, the philippines, rwanda, in india, which all receive the highest score possible under the Regulatory Environment dimension. For example, in addition to promoting mobile money interoperability, india has licensed several entities at payment banks which effectively increased Access Points for underserved individuals. Next, listening to adoption findings. The data and metrics on the adoption of traditional and digital Financial Services are consistent from last year and among the countries that were added in 2016 and one example is the Dominican Republic which received the highest adoption for among those countries. Now, lets turn to some of the key findings and call to action in this years report. Across our countries, one encouraging finding is that there has been considerable growth in recognition in final inclusion is not only important for individual welfare but it can also contribute to macroeconomic growth and Sustainable Development goals including the one i mentioned previously. The one Interesting Data point on this front is that out of this year all of the countries in our sample our members of Financial Inclusion oriented groups or networks and while membership in these groups is important and valuable we also need concrete steps to emerge from their engagement. This is where infrastructure investment, and the regulatory component of this scorecard come into play. In addition we also need consistent, detailed data to track progress toward these goals. One example is a portal that enables countries to do that is the alliance for Financial Inclusion new data portal which is a helpful platform and we hope that more countries will take the opportunity to include timely detailed data that is available for public consumption in order to help with knowledge sharing and accountability. Moving to our next key finding. Syntax which is intact the intersection of finance and technology provide tremendous opportunity to accelerate progress toward Financial Inclusion. Basically contact includes our innovative use of technologies to both design and deliver Financial Services on product and if that sounds like a broad catchall term, thats because it is. This can help enhance the accessibility and the utility of Financial Services for consumers and render the deployment of these services more costeffective for providers. For example, in a july 2017 report by the institute of National Finance in the center for Financial Inclusion Spanish Banks is working with the chilean fintec to extend Credit Access to individuals who may not have a typical Credit History that they have established. We are excited about these kinds of developments because they not only enable customer asks us Financial Services but they can also help it become more accessible for individuals to use the services. How are some countries taking fintec into account but one example is in indonesia where as august 2016 the Financial Services authority provided an outline of guidelines for the local fintec industry. Additionally, in south africa, this is increasingly prevalent and the Regulatory Framework is expected to form part of the context of Financial Institution built in 2017. Finally, we encourage countries to amplify an investment in Cyber Security efforts and knowledge sharing in order to fully reap the benefits of Financial Services innovation. With the proliferation of Digital Technologies boundaries are blurring across traditional Service Providers as well as Tech Startups and other groups. While many of these fintec companies are nimble and costeffective they may also not have the resources, the infrastructure or the experience to ensure that the services they help provide our safe and secure. With that said, of course, banks are also not exempt from this, particularly when they have outdated or centralized systems. In a conversation with many stakeholders that we had in february of this year, one suggestion that emerged with some policymakers as well as Financial Service providers to work with technical experts to essentially provide a set of menu options to enhance Cyber Security and to provide Technical Assistance for implementing those solutions. Moving forward, we look forward to hearing from all of you regarding this years report and scorecard, as well as the 2015 and 2016 report. We will continue our efforts to facilitate dialogue regarding important Financial Inclusion development and the outcome of the scorecard. We have an address set up here at brookings. Edu where we welcome your feedback. Now, thank you for listening to the presentation and i would like to invite our moderator john as well as our distinguished panelists to the stage to share their perspective on Financial Inclusion. Carmac[applause] you very much to robin and darrell for putting us on the stage here and thanks you for taking time out of your schedule to help us with the dialogue on this important topic. The organization for the remaining portion of the program is i will introduce our panelists and i will ask a series of questions and we will hear their perspective until approximately 11 00 oclock and then we will open it up to questions that you may have aimed in those might end at 11 30. Ill briefly introduce our palace pretty mainly to my left is camille. She is director of the brookings race prosperity and Inclusion Initiative in a senior fellow and government studies and she also has appointment here at brookings in the economic studies and metropolitan policy program. Camille has dedicated her career to expanding financial opportunities for low income populations. She came to brookings from the gap, the group that is the support she served as the organizations lead financials sector specials. Previously worked for the Consumer Financial Protection Bureau, Us Government financial regulator where she served as the agencies head of the office of financial indication. To her left we have diego, he is an International Consultant in the area of Digital Transformation in government. He was minister of information and Communication Technology to the acronym ict of columbia from 20102015. During his tenure, columbia expanded all of the elements of the visual ecosystem, not only in production but services, applications and users. Internet coverage extended to low income homes

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