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Here is a short photo review of the first day of the Financial Inclusion 2020 Global Forum.
Please click on any photo to see a larger image.
Global Forum Venue: The London Lancaster
Networking lounge
Registration ready!
New connections
Susy Cheston opens the Global Forum
Citigroup CEO Michael Corbat and MasterCard CEO Ajay Banga
Diana Taylor, MD Wolfensohn Fund Management
Michael Corbat, Citigroup CEO
Networking
Interviews with forum guests
Elisabeth Rhyne, Center for Financial Inclusion MD
Questions from the floor
Sendhil Mullainathan, Professor of Economics, Harvard
Panel discussion
Blog interviews
Bob Annibale, Global Director Citi Community Development and Microfinance
Michael Schlein and Ajay Banga – Fireside chat
Elisabeth Rhyne, Managing Director of the Center for Financial Inclusion, discusses the background to the FI 2020 Global Forum. She details how and why 300 representatives from across the world – representing public, private and non-profit sectors – are coming together at the Lancaster London Hotel from October 28-30th to map out how full financial inclusion can be achieved by 2020.
Recent History
We started a couple of years ago with the question “could financial inclusion be achieved around the world by 2020?”. We did that to get people to think ahead, to look into the future instead of focusing on their problems today.
In preparation, we did two things. First we undertook some demographic research called ‘Mapping the Invisible Market’.
The bigger project was a series of working groups on each of the critical topics for Financial Inclusion. These working groups’ focus areas were defined by a survey we undertook to understand the opportunities and obstacles to financial inclusion.
The working groups had representatives from 40 organizations and have produced five roadmaps to financial inclusion – work that has subsequently been vetted by another 200 people. Our five Roadmaps to Inclusion are:
1. Technology Enabled Business Models
2. Consumer protection
3. Addressing Customer Needs
4. Financial Capability
5. Credit reporting
The FI2020 Forum: Creating a community of action
The people at the Forum are hand-picked to represent the different stakeholders in the industry. Indeed, one of the things that makes this meeting unique is that we have a broader array of people than ever before. We have people from major corporate and regional banks, microfinance institutions, telecoms companies, policy makers, regulators, investors and supporting organizations.
By bringing these diverse groups of people together, the Forum is creating a community – a community that has a commitment to action.
The Roadmaps have ten key action principles which are underpinned by a host of more detailed points. The work of this Forum is to put more action steps around those action principles – being specific about who needs to do what.
My hopes for the Forum
I hope that people come away from this forum with a much deeper vision of what financial inclusion is and what it entails.
I hope to see people getting excited about what actions need to be taken – identifying new opportunities and making commitments to take them. I also hope that people begin to see financial inclusion from the perspective of a client – of financial services making a real difference in their lives in both the short and long-term. A lot of times, financial inclusion is seen as ‘banking the unbanked’ – I hope people come away with a much deeper vision of what Financial Inclusion is and what is required to make it happen.
To see what others are saying and posting about the Global Forum, visit the Financial Inclusion 2020 website and follow #FI2020 on Twitter.
> Posted by Center Staff
The FI2020 Global Forum in London gets underway this Sunday with a pre-Forum side meeting on financial inclusion for persons with disabilities (PWDs). This client-centric start feels like a fitting precursor for an event to expand financial inclusion.
Financial inclusion requires that financial services meet the unique needs of all clients, especially the needs of the most underserved and vulnerable client groups. Sessions throughout the Forum reflect this key tenet. In addition, there are side meetings on the Financial Capability Roadmap and the Consumer Protection Roadmap, focused on moving these roadmap principles and recommendations to action. These and the other three financial inclusion roadmaps were developed through a consultative process that collected and incorporated the perspectives of specific client groups.
Among Forum participants are representatives of various client segments – such as PWDs, women, the elderly, youth, rural populations, and migrants – to help raise awareness of their unique needs and assets. Here’s a collection of pertinent statistics for financial inclusion on these client segments:
Youth:
- 1.8 billion of the world’s population is between the ages of 10 and 24
- 87 percent of youth are concentrated in the developing world
- About half the world’s youth report being economically active
- 38 percent of young adults have an account compared to over 54 percent of older adults
The Elderly:
- In 1950, globally, 1 in 20 people were elderly. By 2050, it will be 1 in 5.
- In 2000, only 6 percent of people in less developed countries were over 65 years old. By 2050, that number will grow to 20 percent.
> Posted by Center Staff
The Financial Inclusion 2020 Global Forum is a few days away! Kicking off with side sessions this Sunday the 27th on persons with disabilities and the Microfinance CEO Working Group, the landmark event for expanding global financial inclusion is almost here.
Taking place on October 28-30 in London, the event will convene approximately 300 leaders in financial inclusion, spanning sectors and industries, in a collaborative environment where they can map the action agenda for achieving financial inclusion by the year 2020. Participants include key players from the financial sector, technology providers and the corporate sector, international non-profits, and public policymakers. For the full list of attendees, click here.
The Forum agenda includes an assortment of session types, with a number of opportunities for participant engagement. In one roundtable breakout session, participants will discuss how to take the Roadmap recommendations from ideas to action, identifying priorities for implementation. Other sessions include a Forum-opening discussion on factors that put financial inclusion by 2020 within reach, a plenary on mobile money and spurring innovation, a presentation on the forthcoming CFI report Opportunities & Obstacles in Peru, and a fireside chat and Q&A with Ajay Banga and Michael Schlein, CEO’s of MasterCard and Accion. For the full agenda, click here.
Along with Banga and Schlein, Forum speakers include Cherie Blair, Founder of the Cherie Blair Foundation for Women, Aigboje Aig-Imoukhuede, CEO of Access Bank, Nick Hughes, Founder of M-PESA and M-KOPA, Duvvuri Subbarao, former Governor of the Reserve Bank of India, and Bindu Ananth, President of IMFR Trust. For the full speakers list, which includes a handful of newly confirmed speakers, click here.
> Posted by Danielle Piskadlo, Senior Program Specialist, CFI
The Investing in Inclusive Finance program at the Center for Financial Inclusion at Accion explores the practices of investors in inclusive finance. Across areas including risk, governance, stakeholder alignment, and fund management, this blog series highlights what’s being done to help the industry better utilize private capital to develop financial institutions that incorporate social aims.
Governance challenges vary greatly between institutions and regions, and that is why there is such a great opportunity for boards and MFIs to learn from each other by sharing their personal experiences.
Earlier this month the CFI’s Investing in Inclusive Finance program, along with Calmeadow and Boulder Institute of Microfinance, hosted a governance seminar in Mexico called Governance Leadership in a Competitive World. The seminar was structured as a peer-to-peer learning opportunity to engage board members and CEOs in an active dialogue. Participants discussed the challenges they face in governance and risk, and their roles and responsibilities in setting and monitoring the MFI’s mission and strategy. The cases, tools, and materials presented at this seminar created an opportunity for board members to share their experiences and to learn governance best practices from each other. While there are many complexities and nuances to governance, below are 12 practices we hope will be implemented from our governance seminar.
> Posted by Tilman Ehrbeck, CEO, CGAP
The following post was originally published on the CGAP Blog.
World leaders are embracing financial inclusion at an accelerating pace. In May, the UN High-Level Panel chaired by Liberia‘s President Johnson Sirleaf, Indonesia’s President Bambang Yudhoyono, and the UK’s Prime Minister David Cameron, presented the recommendations for the post-2015 UN Development Goals, which included universal access to financial services as a critical enabler for job creation and equitable growth. In September, the G20 reaffirmed its commitment to financial inclusion as part of its development agenda. And most recently, during the IMF/World Bank Annual Meetings earlier this month, World Bank President Jim Kim called for collective action to reach universal financial access by 2020.
World leaders do this because they know that an inclusive financial system that responsibly reaches all citizens is an important ingredient for social and economic progress for emerging markets and developing countries. At the microeconomic level, it helps poor households and small businesses generate income, build assets, smooth consumption, and better manage risks. At the macroeconomic level, the depth of financial intermediation under most circumstances spurs growth and reduces inequality. An inclusive financial system also helps governments to better execute social policy in other priority areas such as education and health, for example through more targeted financial transfers.
> Posted by Elisabeth Rhyne, Managing Director, CFI
The following post was originally published on the World Bank Private Sector Development Blog.
The issue of financial inclusion seems to be everywhere – from the World Bank Annual Meetings to the new UN post-2015 development goals. It’s got buzz in the private sector, public sector and development organizations big and small. Policymakers are increasingly making financial inclusion a priority through specific financial inclusion targets and commitments, such as the Alliance for Financial Inclusion’s Maya Declaration. In fact, World Bank Group President Jim Yong Kim recently launched an initiative “to provide universal financial access to all working-age adults by 2020.”
As we know from the Global Findex, more than 2.5 billion people lack access to even a basic bank account — a huge gap in inclusion and an enormous opportunity. Demographic changes, economic growth, and advances in technology are making global financial inclusion more possible than ever before. With a massive new market of people demanding new services as incomes rise among the bottom 40 percent, the stage is set for dramatic leaps in access in the next few years. Emerging technologies are bringing down costs and opening new business models while providing greater access to a range of services.
Recognizing that the time is ripe for significant progress on financial inclusion, the Center for Financial Inclusion developed a consultative process aimed to raise everyone’s sights about the possibilities of achieving full inclusion within a foreseeable timeframe – using the year 2020 as a focal point. The process sought to build a more cohesive financial inclusion “community” through the development of a common vision. It brought together experts from the World Bank, IFC, and CGAP along with many representatives of the private sector and the social sector. Financial Inclusion 2020’s Roadmap to Financial Inclusion is the result.
With all of the financial inclusion buzz, you would think that we would be closer to full inclusion. But if closing the gaps were easy, it would have happened already. Many factors still stand in the way. In the case of regulatory accommodation to new technology, for example, the gaps result from such factors as the pace of the spread of know-how among policymakers globally, national legislative and political processes, and uncertainty about the risks involved with new models. In the case of fully addressing the needs of customers at the base of the pyramid (BOP), gaps stem from a combination of doubt among providers about the likely profitability of these customers and limited knowledge inside institutions about the financial lives of the poor. In the case of client protection, providers face perverse incentives, while many regulatory bodies are only beginning the major task of establishing robust oversight of market conduct.
We see encouraging examples of financial inclusion in the most remote corners of the world, often done by surprising actors. However, the momentum is uneven. The Roadmap process included many of the thinkers and entrepreneurs behind such initiatives. Each of the five working groups — Addressing Customer Needs, Technology, Financial Capability, Client Protection and Credit Reporting — has developed a roadmap to direct the world community toward the actions most needed to achieve FI2020’s vision of full financial inclusion. Most of the recommendations are addressed either to governments or to providers, but they point the way to actions needed by a range of supporting organizations, including multilateral and bilateral organizations, donors, social investors and non-profits, at both the global and the national levels.
> Posted by Jeffrey Riecke, Communications Assistant, CFI
The following post is comprised of research from three Credit Suisse Virtual Volunteers, Vipin Gupta, Kajal Shah, and Jennifer Hughes.
Most persons with disabilities (PWDs) don’t have an account at a formal financial institution. In India, 5 – 6 percent of the population (roughly 66 million) are estimated to have a disability, and three-quarters of Indian PWDs live in rural areas where access to banking services is limited. In India on the whole, about 35 percent of the adult population has a formal bank account. In Mexico, about 10 percent of households have at least one member with a disability, and about 27 percent of the country’s adult population has an account at a formal financial institution. These two countries present huge financial inclusion opportunities for PWDs. Encouragingly, significant PWD inclusion in-roads in both are underway.
In India, low financial inclusion incidence among PWDs is connected with poverty and unemployment. A meager 0.14 percent of PWDs in India hold regular jobs. This employment statistic stands in spite of efforts from the National Centre for Promotion of Employment for Disabled People (NCPEDP) mandating that 3 percent of government jobs be reserved for PWDs, and incentivizing private employers to ensure that at least 5 percent of their workforce is comprised of PWDs. The same low fulfillment of positions reserved for PWDs has been seen in several of the government’s rural employment schemes. In a study examining labor-intensive agricultural occupations in India, it was found that the majority of PWDs were not chosen by potential employers, and that PWDs in rural areas mostly depend on non-agriculture-based-self-employment as a means of livelihood. For these individuals and others pursuing self-employment, a lack of adequate capital can be a critical roadblock to earning a livelihood.
There are a multitude of factors contributing to this situation, including low education (only half of Indian PWDs have any formal education), inability to afford health treatments, un-inclusive employment settings, un-inclusive surroundings, prejudice against PWDs, lack of awareness of support programs and other resources, and geographic remoteness to banking, education, employment, training, and rehabilitation facilities. Nearly any of these factors are enough to pose large, or in some cases insurmountable, challenges to accessing formal financial services. When combined, the task of accessing traditional avenues of financing can be overwhelming. For many PWDs, the only viable source of financing is money from friends and family, but in lower-income rural areas even that is difficult to come by.
Other challenges that stand in the way of greater inclusion of PWDs in India include lack of a standardized method for defining and evaluating disability, and lack of up-to-date data.
> Posted by Hemang Mandalia, Software Engineer, Investment Banking, Credit Suisse
The Financial Inclusion 2020 project at the Center for Financial Inclusion at Accion is building a movement toward full financial inclusion by 2020. Accordingly, this blog series will spotlight financial inclusion efforts around the globe, share insights coming out of the creation of a roadmap to full financial inclusion, and highlight findings from research on the “invisible market.”
This is the third in a series of several posts from this year’s Credit Suisse Virtual Volunteers, where research and insights across a variety of financial inclusion areas will be shared.
This brief tale begins with an investment scheme from a corporation called Sahara that claimed to seek “financial inclusion” through investments from the unbanked, but at the same time sought regulatory exclusion for its practices. Sahara provided investment opportunities to the rural nooks and corners of India that were overlooked by most major banks – but it is alleged to have falsified records and subverted Indian regulations.
Sahara India Pariwar is an enormous Indian conglomerate with headquarters in Lucknow, Uttar Pradesh. Its diversified business has interests in finance, infrastructure and housing, media, entertainment, retail, manufacturing, and information technology. Sahara has also been the main sponsor of the Indian national cricket team for several years, cricket being so popular it is often referred to as a religion. The link to cricket has helped Sahara establish itself as a household name.
Sahara’s financial services companies are said to have 100 million depositors and investors in villages and small towns, often from rural unbanked areas. As for the group’s investment products, Subrata Roy Sahara, chairman of Sahara, indicates they serve small investors who are outside the banking system.
> Posted by Center Staff
This edition of Top Picks features posts highlighting findings from new research on the global mobile money industry and on remittances in Africa and Asia, as well as a post on how innovation can encourage savings at the base of the pyramid.
A new post on GSMA’s Mobile Money for the Unbanked Blog shares preliminary findings from the MMU 2013 Global Mobile Money Adoption Survey. The Adoption Survey, which offers insights on the development of mobile money services and how they’re enabling the expansion of financial inclusion, will be published at the 2014 GSMA Mobile World Congress, February 24-27 in Barcelona. These preliminary findings included a few industry milestones. A few weeks ago the global industry surpassed 200 mobile money service deployments to total 208 services spread across 83 developing countries. Mobile money services are become a mainstay among mobile network operators, rather than a differentiator. In Sub-Saharan Africa, for example, mobile money is available in 36 out of the 47 countries in the region.
In Africa and Asia, domestic remittances may far surpass international remittances in both frequency and magnitude, two recent joint-reports from the Gates Foundation and Gallup found. That’s the subject of a new post on the Financial Access Initiative Blog, which details the reports’ key results and provides a brief overview of domestic remittances, internal migration, and how they relate. The reports revealed that across the 11 surveyed countries, 14 percent of people had sent money to family or friends within the country within the previous 30 days, and that 32 percent of these respondents had been on the receiving end of such a money transfer. In contrast, one to two percent of people reported sending an international remittance, and about three percent reported receiving an international remittance, in the previous 30 days.
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