On November 29-30, 2007 the Center for Global Development (CGD) and the Spanish Ministry of External Relations and Cooperation convened a high-level workshop titled, "Policies and Innovations for Improving Access to Financial Services: A Global Challenge."
The workshop drew a crowd of over 50 distinguished participants, including officials from industrial countries, representatives from the private financial sector, and central bank leaders from Turkey, Zambia, Uruguay, Bolivia, Rwanda, Malaysia and Kenya, as well as several leading academic experts. Enrique V. Iglesias, Secretary General, Ibero-American Secretariat and former president of the Inter-American Development Bank delivered a keynote address; attendees also enjoyed comments from Brian Pomeroy, Chairman of the U.K. Financial Inclusion Taskforce and Guillermo Ortiz, Governor of the Central Bank of Mexico.
They met to discuss the problem of low access to financial services for poor people in developing countries – and what can be done to overcome it. Limited access to financial services is recognized as a major impediment to growth and prosperity for both individual consumers and small businesses in developing countries, and improving access is a high priority for policymakers.
The discussion was organized around five main themes, each corresponding to a session in the workshop:
- Facts and main issues about the lack of financial access around the world – in some sub-Saharan countries it is as low as 10 percent.
- Obstacles to financial access, ranging from institutional and regulatory frameworks to macroeconomic policies and financial sector industry practices.
- Successful experiences in improving access, with discussion of the both the asset and liability sides of financial system activities.
- The role of industrial countries in improving access in developing countries, including a discussion of current G8 initiatives.
- The potential impact of new initiatives proposed by the international private sector and donors.
In many developing countries, governments and private groups have launched a number of programs including investments in financial infrastructure, adaptation and use of technology to reach a larger segment of the population, fiscal incentives to financial institutions for the provision of financial services, and support to microfinance institutions – all aimed at increasing access for the poorest. At the international level, the G-8 has included the issue of access to finance in their recent summits. The 2006 G-8 Summit called for the development of financial literacy guidelines based on best practices and the 2007 Summit created the initiative "Partnership for Making Finance Work for Africa." The international private sector is also increasing its participation in this crucial effort for development.
What can we learn from all these initiatives? What is needed for effective support from the private sector and donors in this endeavor? What country level proposals can be adapted to other countries or regions of the world? Is there sufficient international coordination to achieve the desired objectives? These are some of the issues and questions that the workshop tackled through a frank exchange of views among participants.