FIRST Consultative Group Meeting 2015 AFI Presentation 9 JUNE 2015 Bringing smart policies to life
Overview AFI network & impacts, to date AFI in the future Global trends in financial inclusion Opportunities for partnership 2 Bringing smart policies to life
The AFI Network Today 2008 2012 2009 2010 2011 Building the Activating the Enhancing Network Policy-Driving Concept design Network Network value Network • 125 Inst it ut ions, 96 count ries • More t han 100 t angible policy reforms • Unique Peer Learning net work (6 working groups) • Maya Declarat ion wit h 54 commit ment s • Financial Inclusion ent ered mainst ream of int ernat ional policy agenda • Two Regional Init iat ives • G20 Implement ing part ner • PPD Plat form AFI has become the world’s leading organization on financial policy and regulation . Bringing smart policies to life
AFI Working Groups Consumer Financial Empowerment Inclusion Data & Market Conduct Financial Inclusion Digital Financial S trategy Services Global Standards S ME Finance Proportionality Bringing smart policies to life
Member Engagement & Financial Inclusion The increase in financial inclusion is positively correlated (0.35) with members’ level of engagement with AFI N AFI members = 65 *Cambodia, Mauritius N/ A 3.5 AFI Member 2.5 engagement index 1.5 0.5 -20 -10 0 10 20 30 40 Increase in percentage of adults with formal accounts (ppt) S ource: Data from World Bank Global Findex, compiled by AFI; AFI Member Engagement Index 2014 Bringing smart policies to life
Maya Declaration & Financial Inclusion AFI members that have adopted Maya Declaration increased financial inclusion by 9.5 ppts, compared to 8.9 ppts for AFI members without Maya Declaration N Maya = 48 N No Maya = 42 9.5 10 8.9 ~ 70% of the commitments Increase in % are related to of adults with 5 accounts from digital financial 2011-2014 services. (ppt) 0 Median Adopted Maya declaration No Maya Declaration S ource: Data from World Bank Global Findex, compiled by AFI; AFI Maya Declaration Report 2014 Bringing smart policies to life
Measurable targets & financial inclusion AFI members with measurable targets increased financial inclusion by 13.4 ppts, compared to 8.5 ppts for those without measurable targets 16 13.4 N members targets = 13 12 N members no targets = 16 Increase in % of 8.5 adults with 8 accounts from 2011-2014 (ppt) 4 0 Median Measurable targets No targets S ource: Data from World Bank Global Findex, compiled by AFI; AFI Maya Declaration Report 2014 Bringing smart policies to life
AFI Created Impacts at Speed and Scale In 6 years, 116 policy improvements have been developed by members as a result of AFI activities. Number of Policy Changes, by Regions Eastern Middle East Europe & & North Central Asia Africa East & ~ 70% are Sub-Saharan 3 South Africa related to 7 Asia 38 17 digital financial services or 116 consumer protection & empowerment 21 Pacific 30 Islands Latin America & the Carribbean Bringing smart policies to life
The Regulatory Journey: Bank of Tanzania PEER LEARNING AND BANK OF TANZANIA’s OUTCOME KNOWLEDGE EXCHANGE ACTIVITIES • Makes digital finance regulation a priority • Joins AFI network • Signs MoU with national • Joins 4 working groups communications regulator and plans MoU with insurance • Conducts Knowledge Exchange visits authority. to Philippines • Receives AFI policy grants for mobile financial services • Creates public awareness and • Goes on knowledge exchange to financial education framework Brazil and Kenya • Drafts new mobile payment • Announces Maya Declaration regulation Commitment • Joins 5 th and 6 th working groups • Implements new agent banking regulation • Engages in peer advisory with • Launches national financial Brazil inclusion framework 2014 Bringing smart policies to life
MFS Experiences in Tanzania Example: Impact of policy and regulation • Interoperability • Partnerships and cooperation • Government Uptake of Usage of MFS • Enabling legal and regulatory environment • Adoption of MFS in National Financial Inclusion Framework BoT joined AFI. Source: Bank of Tanzania Bringing smart policies to life
Learning & leadership journey: Bank Al-Maghrib 2014 2013 Committed to increasing Created financial 2012 access to banking services inclusion indicators based up to two-third of the on the AFI Core Set of FI Joined Global population by the end of indicators Standards 2014, under the Maya Proportionality Declaration Co-hosted a FIDWG 2011 Working Group Meeting (GSPWG) Also made Maya commitments on financial Joined AFI literacy and financial Joined Financial inclusion data Inclusion Data Working Group Became a co-chair of (FIDWG) GSPWG Bringing smart policies to life
AFI’s Transition to Independence Executive Director • AFI members Committed to paying annual membership fees from 2016 • The AFI Management Unit (S ecretariat) relocated to Kuala Lumpur in January 2015 • S tatus of AFI’s legal registration in Malaysia – Articles of Association (bylaws) submitted to Malaysian Authorities (March 2015) • Unplugging from GIZ Bringing smart policies to life
Preparing for new challenges and opportunities Personnel - Compensation and Benefit Structure finalized and approved Personnel - Contract transition started Independent institution 2015 owned, governed, and 1 ‐ Jun 1 ‐ Jul 1 ‐ Aug 1 ‐ Sep driven by policymakers and regulators Independent AFI Bank Account Registered as International Organization Own Accounting system (Blackbaud Financial Edge) Own Contract process Own Procurement process Bringing smart policies to life
AFI’s Strategic Vision: A Dynamic Growth Path Level of Member 2016 Engagement 2012 Policy Leadership Policy Alliance Driving Network Learning & Exchange Platform Grant- Making Facility Grants Time 2008 Bringing smart policies to life
AFI’s Strategic Vision: A Dynamic Growth Path Level of Member 2016 Engagement 2012 Policy Leadership Policy Alliance Driving Network Learning & Exchange Platform Global Policy Forum Grant- Working Groups Making Facility Time 2008 Bringing smart policies to life
AFI’s Strategic Vision: A Dynamic Growth Path Level of Member 2016 Engagement 2012 Policy Leadership Policy Alliance Driving Network Learning & Global agenda (SSBs, GPFI) Exchange Maya Declaration Platform Public-private Dialogue Grant- Regional Initiatives Making Facility Time 2008 Bringing smart policies to life
AFI’s Strategic Vision: A Dynamic Growth Path Level of Member 2016 Engagement 2012 Policy Leadership Policy Alliance Driving Capacity Building Network Learning & Technical Assistance Exchange from members to Platform members Stakeholder alignment Grant- Cooperation for Policy Making Implementation, with Facility funding support Time 2008 Bringing smart policies to life
Quality of financial inclusion will gain greater priority among policymakers and regulators, as the issues of access and usage are overcome. • 80% of the Maya commitments include specific Number of Maya commitments on consumer protection and/ or financial literacy targets on consumer protection and/ or financial literacy • CEMCWG is the second largest Working Group, with 48 6 23 16 current members. • CEMCWG and FIDWG are working to create Quality Consumer Financial protection, only Indicators of Financial literacy, only Both Inclusion New technologies create greater opportunities for consumer empowerment but also new risks Bringing smart policies to life
Policymakers and regulators will be enablers of safe and accessible DFS The need for closer Greater Convergence dialogue between between bank and non- financial and telco bank DFS deployments regulators Strengthened Rises of Digital ID and consumer protection “Big Data” Digital Financial Services Working Group (DFSWG) and Public-Private Dialogue (PPD) Platform Bringing smart policies to life
Trends in Financial Inclusion Data In the next 3-5 years, Policymakers and More data shared countries will have regulators will use by the private comprehensive supply these data to set sector will and demand-side data quantified targets enhance impact that is country-led and to inform policy measurement. and owned. solutions. In AFI, members are sharing data and progress reports on their Maya commitments through the Online Progress Dashboard (OPD) Bringing smart policies to life
Massive drop in number of unbanked, yet gender gap remained persistent S ource: World Bank – Global Findex 2014 S ource: World Bank – Global Findex 2014 Globally, the number of unbanked adults dropped by However, gender gap remained persistent at 9% 20% to 2 billion Gender gap (% ) between male and female with formal accounts, in selective countries (% ) 30 20 17 20 9 9 8 8 5 10 1 0 Global China India Russia US -2 -10 -6 S ource: World Bank – Global Findex 2014, compiled by AFI Gender Gap 2011 Gender Gap 2014 Bringing smart policies to life
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