An international call to action on financial inclusion

Alfred Hannig

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High-level policymakers from the AFI Network take part in the 2015 Global Policy Forum in Maputo, Mozambique in September 2015.

Every year, the weeks before the Alliance for Financial Inclusion’s (AFI) annual Global Policy Forum (GPF) give us an impetus to reflect on our progress from the last Forum. Like the years before, 2015 has seen more encouraging progress, starting with the continued growth of the AFI network—rising to more than 120 members from over 90 countries. But for many reasons, 2015 has been a milestone year for AFI. Since last year’s GPF, the AFI Management Unit has relocated from Bangkok to Kuala Lumpur, and a majority of members have committed to the payment of membership fees in 2016, demonstrating how the members are taking ownership of the network. Another key milestone was achieved in July when AFI’s Articles of Association were formalized with the signing by five promoting members. We are now in the final stages of confirming the Host Country Agreement between AFI and the Government of Malaysia, paving the way for AFI’s establishment under Malaysian law as an international organization. I’m excited to share and elaborate on these developments with the AFI network at the 2015 AFI Global Policy Forum in Maputo in a few days’ time.

However, while these new developments and continued growth are exciting, I always ask myself each year the same question: are we making a difference?

More specifically, do our members, regardless of the number, find AFI valuable? Is their engagement in the network enabling effective policy solutions and driving financial inclusion? Fortunately, since 2009, we’ve measured member satisfaction and AFI’s impact in our member institutions through our annual Member Needs Assessment (MNA) survey. Level’s of satisfaction with AFI activities and initiatives have been consistently high since the first survey. Each year there are a number of key takeaways from the survey, and the 2015 MNA delivered one of the most remarkable yet: nearly half of those who completed the survey indicated that upwards of 80 percent of their financial inclusion policy changes came about through their engagement with AFI. In addition, over two-thirds of respondents reported that AFI membership contributed to more than 50 percent of policy changes in their institutions. This is a remarkable result that demonstrates how AFI members are truly leading the change and leveraging their participation in AFI initiatives to make great strides toward achieving financial inclusion goals in their countries. Look no further than the 2014 Global Findex to see the impact of these efforts, with statistics showing an increase of 700 million new accounts since 2011.

High-level policymakers from the AFI Network attend the 2014 Global Policy Forum in Trinidad and Tobago.

High-level policymakers from the AFI Network attend the 2014 Global Policy Forum in Trinidad and Tobago.

Equally impressive is how our members’ work has made an impact beyond AFI. I often say in my speeches and presentations that financial inclusion has moved from the fringe of the global development agenda into the mainstream. In the recent years, financial inclusion has been taken up at the highest levels of leading international organizations and development institutions. We see this in the G20, particularly through the Global Partnership for Financial Inclusion (GPFI) to which AFI is an implementing partner, at the IMF as evidenced by the agenda of this year’s World Bank/IMF annual meetings in Peru, as well in the establishment of financial inclusion as a recurring theme and in the mandate of the Standard Setting Bodies (SSBs). There is also a rallying of major private sector stakeholders around financial inclusion, including through participation in AFI’s Public Private Dialogue platform, another AFI milestone from 2015. But in July of this year the acceptance of financial inclusion as a fundamental cornerstone of international development was made clear with the adoption of the Addis Ababa Action Agenda by the United Nations.

The Addis Ababa Action Agenda builds upon the 2002 Monterrey Consensus and the 2008 Doha Declaration, serving as a foundation to support implementation of the post-2015 development agenda which aims to: “end poverty and hunger, and to achieve sustainable development in its three dimensions through promoting inclusive economic growth, protecting the environment, and promoting social inclusion.” To ensure achievement of the Sustainable Development Goals (SDGs), the Addis Ababa Action Agenda establishes a new global framework for financing sustainable development that aligns all financing flows and policies with economic, social and environmental priorities. It includes a comprehensive set of policy actions by member states with over 100 concrete measures and also serves as a guide for further actions by governments, international organizations, the business sector, civil society, and philanthropists.

While more wide-ranging and thematically diverse, it is similar in outlook and purpose to AFI’s own Maya Declaration, in that it promotes “cohesive nationally owned sustainable development strategies” that take into account the different domestic situations of member states but that recognize the importance of a supportive and enabling international system. It was heartening to see that the Addis Ababa Action Agenda takes into account the regulatory and other policy requirements for realizing the economic, social and environmental dimensions of sustainable development, specifically recognizing the importance of national banks and financial regulatory frameworks, as well as the roles of technology and capacity building.

Even more exciting, the Addis Ababa Action Agenda outcome document features a dedicated initiative on financial inclusion, with the Alliance for Financial Inclusion as the only organization named as a partner for this effort. The document highlights the importance of AFI’s core work areas such as mobile banking and digital financial services, remittances and financing for SMEs, and endorses the merits of peer learning, mutual collaboration and knowledge exchange—approaches that AFI champions.

I see this as both a recognition of financial inclusion as a key development issue, and of AFI as the ideal leadership organization to take these efforts forward. Initiatives to further financial inclusion can now be seen on the forefront of the mainstream global development agenda, with the role of financial sector regulators recognized as key to achieving not only financial inclusion and stability objectives, but also for supporting progress towards supporting, gender equality and reducing economic inequality.

Thanks to the work of our members, financial inclusion is now truly in the international spotlight. AFI is honored to play in role in supporting our members’ work at the national level as well as channeling the voice of the network at the global level. The impetus is now truly with the AFI Management Unit, as well as our members, partners and peers, to ensure we deliver tangible results, and continue to serve as global leaders in the diverse ecosystem of financial inclusion stakeholders.

I know we will not disappoint.

ABOUT THE AUTHOR
Alfred Hannig is Executive Director at the Alliance for Financial Inclusion.

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