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Alliance for Financial Inclusion

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Alliance for Financial Inclusion
AbbreviationAFI
FormationJanuary 1, 2008; 16 years ago (2008-01-01)
FoundersBill and Melinda Gates Foundation, GIZ
TypePolicy institute, Think tank, Capacity building, Peer-learning network
PurposePoverty reduction, Financial inclusion, Developmental aid, Sustainable development
HeadquartersKuala Lumpur,  Malaysia
Location
  • Sasana Kijang, 2, Jalan Dato' Onn, 50480 Kuala Lumpur, Malaysia
Region served
Worldwide
Official language
English, French, Spanish
Executive Director
Dr. Alfred Hannig
Deputy Executive Director
Norbert Mumba
Staff50-100
Websitewww.afi-global.org
  Countries with AFI members

The Alliance for Financial Inclusion, or AFI,[1] is an international policy institute and public policy network that specializes in financial inclusion policy for the unbanked and underbanked population of the world. Its members include roughly 100 institutions comprising central banks, financial regulatory institutions, and financial inclusion policymakers from 80 least developed and developing countries.

AFI connects, encourages and enables policymakers to build capacity and develop policy initiatives in areas of financial technology (FinTech), consumer protection, microfinance, SME finance, gender-inclusive finance, inclusive green finance, micro-savings, and other general financial inclusion initiatives in Africa, Asia, Europe, Pacific Islands, Latin America, Caribbean, and the Middle East. While AFI members are predominantly regulatory institutions, it also engages with a variety of stakeholders, including governments, development agencies, and private sector firms through its strategic and knowledge partnership platforms. AFI also runs the world's largest financial inclusion forum annually.[2]

AFI is currently headquartered in Kuala Lumpur, Malaysia, with regional offices in Africa, Latin America, and the Caribbean. The current executive director is Dr. Alfred Hannig, who has held the post since 2008.[3]The organization has three working languages: English, French and Spanish.

Organization and mission

AFI's core mission is to empower policymakers to increase the access and usage of quality financial services for the underserved through the formulation, implementation, and global advocacy of sustainable and inclusive policies.

It was founded in 2008 as a project funded by the Bill & Melinda Gates Foundation,[4] with logistic and knowledge support from Deutsche Gesellschaft fur Internationale Zusammenarbeit (GIZ) GmbH with the goal of advancing the development of financial inclusion policy in developing and emerging economies.[5]

Since then, it has become an independent, member-owned network that has formed strategic and knowledge collaborations with a variety of global donors and partners from both the public and private sectors. Significant year-on-year funding for programs and activities in the network comes from AFI members.

AFI uses a peer-to-peer learning model to connect, encourage, and enable financial policymakers to interact and exchange knowledge on policy initiatives. AFI has pioneered regional approaches to knowledge exchange among policymakers and stakeholders worldwide, notably within the Pacific Islands, Africa, Latin America and the Caribbean, the Middle East and North Africa, Eastern Europe, and Central Asia, as well as Asia. This information exchange is intended to build a more comprehensive knowledge base of financial inclusion, and the subsequent formulation and implementation of the effective policy by members institutions in their home countries.

AFI also operates the AFI Data Portal (ADP),[6] a unique and integrated global database on financial inclusion policies, regulations and outcomes. Housing information sourced directly from policymakers and regulators, the ADP empowers countries to share their financial inclusion stories and formulate policies through on data while also facilitating the study and understanding of trends in financial inclusion. The portal is accessible online and publicly available.

AFI administers financial inclusion policy-related services, including capacity building, working groups, knowledge products, regional initiatives, the provision of grants and in-country implementation support. It also hosts its annual flagship AFI Global Policy Forum (GPF). Since the first AFI GPF in 2009, the event has supported an environment of historic financial inclusion policy initiatives and declarations, including the Maya Declaration, the first global and measurable set of financial inclusion commitments by developing and emerging economies.

History

Origins and until 2008

In 2006, there was an emerging recognition that policies mattered when it came to financial inclusion.There is also a huge sentiment around the potential of digital financial services for increasing financial inclusion for the unbanked population of the world.

Dr. Hannig described the situation in 2006 as follows:[7]

There was a lot of international debate on financial system development and what the financial sector can do to alleviate poverty through microfinance. ... We were just starting to see the potential of digital financial services for increasing financial inclusion for the unbanked.

Through the Gates Foundation, Dr. Alfred Hannig and the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) team successfully received grants to kick-off the first phase of AFI in Bangkok, Thailand and subsequently launched it in Kenya in 2009.

2008 to 2010

Bangko Sentral ng Pilipinas (BSP) of the Philippines, Bank Indonesia (BI), Bank of Thailand (BOT), Central Bank of Kenya (CBK), Superintendency of Banking, Insurance and Private Pension Fund Administrators (SBS) of Peru and National Banking and Securities Commission of Mexico comprised the initial core group of six member institutions. In 2009, the first AFI Steering Committee meeting took place where the Central Bank of Kenya was elected the Chair. Besides, in 2009, AFI gained 44 new members including Bangladesh Bank, Reserve Bank of Fiji, National Reserve Bank of Tonga, and Commission Bancaire de l'Afrique Centrale (COBAC) — representing 70 percent of the world’s unbanked population. Members of the AFI network also reported making 3 policy and regulatory reforms to enhance financial inclusion in their countries. 2009 also witnessed the first AFI Global Policy Forum (GPF) which was held in Nairobi, Kenya with the theme, A marketplace of ideas. Grants to selected member institutions were introduced.

In 2010, the Group of 20 (G20) nominated AFI as one of three implementing partners for the G20 Global Partnership for Financial Inclusion (GPFI). In this role, AFI brings innovative policies for increasing access to financial services from developing countries to the wider G20 forum and facilitates the participation of non-G20 policymakers in developing and emerging economies participate in GPFI work.[8]

2011 Maya Declaration

Main article: The Maya Declaration

In 2011, AFI members collectively adopted the Maya Declaration, a statement of intent to make financial inclusion a centerpiece of national efforts for poverty reduction, economic stability, and economic development. More than 30 AFI member countries then went a step further by announcing specific and measurable commitments. As of 2017, 66 member countries of AFI have committed to the Maya Declaration. Examples of commitment include[9]:

  • Reducing the financial exclusion rate of women from 27% to 13% by 2025 in Cambodia.
  • Developing and implement a financial consumer protection framework, focusing on women, by December 2018 in Lesotho
  • Reducing the gender gap for formal financial services inclusion from 10% to 5% by 2022 in Zambia

Since then, the Maya declaration has paved the way for various other accords in the coming years. In recognition of these developments, both the G20 and the Group of 24 (G24) highlighted the AFI learning model and the Maya Declaration as key steps toward global economic development, with the G20 urging its members to commit to the Maya Declaration.[10]

2013 onwards

In 2013, AFI members adopted the Sasana Accord on Evidence- and Data-based Results, Accelerated Progress and Measurement of Impact.[11] During the same year, AFI reached 100 member institutions overall with the addition of the Central Bank of Trinidad and Tobago[12]

In 2015, AFI members endorsed the Maputo Accord, which commits members to support access to finance for small and medium enterprises.

In 2016, AFI completed the final steps in its evolution from an exclusively donor-funded project into an independent and member-supported international network of policymakers. Members also endorsed the Denarau Action Plan for Gender Inclusive Finance[13] to increase women's access to quality and affordable financial services globally — bridging the financial inclusion gender gap.

In 2017, AFI members adopted the Sharm El Sheikh Accord on Financial Inclusion, Climate Change and Green Finance.[14]

In 2018, AFI celebrated its 10th anniversary at its GPF in Sochi, Russia. During the event, members endorsed the Sochi Accord on FinTech for Financial Inclusion.[15]

In 2019, a letter of understanding was signed between AFI and the Ministry of Finance of the Grand Duchy of Luxembourg to launch a new multi-donor collaboration framework to bolster financial inclusion across the African continent.[16] Minister Pierre Gramegna signed the multilateral LOU, together with AFI Executive Director Dr. Alfred Hannig. The cooperation is rooted in the support toward the advancement of the Sustainable Development Goals (SDGs).

Coronavirus disease 2019 pandemic and AFI's response

On 31 December 2019, health authorities in China reported to the World Health Organization (WHO) a cluster of viral pneumonia cases of unknown causes in Wuhan, Hubei.[17][18] On 30 January, the WHO declared the outbreak a Public Health Emergency of International Concern (PHEIC)—7,818 cases confirmed globally, affecting 19 countries in five WHO regions. As of 19 June 2020, more than 5 million cases of Coronavirus disease 2019 (COVID-19) have been reported in more than 188 countries and territories, resulting in more than 453,000 deaths.[19]

AFI has responded by implementing the AFI's COVID-19 Policy Response that aimed to systematically deliver coordinated policy responses to help AFI members mitigate the impact of COVID-19 on financial inclusion policy implementation, especially for micro, small and medium enterprises and the most vulnerable segments of the population. Virtual engagements were conducted during the lockdown period with technical teams and leadership across its member countries to address specific issues. A series of member needs surveys were distributed to enable AFI to deploy rapid policy response guidelines.[20]

AFI's COVID-19 policy response in Africa

Since the offset of the pandemic, which triggered widespread unemployment and falling levels of gross domestic product and disproportionately impacting the most disadvantaged segments of populations, AFI partnered with the Mastercard Foundation in June 2020 to implement a 2-year COVID-19 Policy Response program in Africa.[21] The program targeted 49 financial sector regulators and policymaking institutions across the region to effectively respond to the economic consequences of the pandemic. In-country implementation activities were conducted specifically in Nigeria, Uganda, Rwanda, Senegal, Ghana, and the Central Bank of West African States.

Working Groups

AFI currently has 7 working groups. These groups serve as the technical backbone for generating knowledge, guiding and implementing policies, and developing policies. AFI Working Groups produce policy guidelines and tools for formulating financial inclusion policies, provide peer reviews, and contribute to the engagement of global Standard-Setting Bodies (SSBs).[22]These groups also represent the thematic areas that AFI actively participates:

Consumer Empowerment and Market Conduct (CEMC)

Examine the importance of consumer empowerment and protection to improve the quality of financial services. CEMC Working Group also advance policy and regulatory issues related to consumer empowerment initiatives and market conduct regulations.[23]

Digital Financial Services (DFS)

Discuss issues related to digital financial services, and promote digital finance as a major catalyst in achieving financial inclusion in emerging and developing countries. DFS Working Group develop policy guidelines, conduct peer reviews, and engage the FinTech industry and global Standard-Setting Bodies (SSBs).[24]

Financial Inclusion Data (FID)

Build knowledge and good practices on areas related to financial inclusion measurements such as indicators, methodologies, global standards, and principles.[25]

Financial Inclusion Strategy (FIS)

Promote the development, implementation, and monitory and evaluation of national financial inclusion strategies.[26]

Global Standards Proportionality (GSP)

Provide technical support on the proportionate application of global standards while supporting, exchanging and discussing measures that strengthen and balance both financial sector stability and integrity.[27]

Inclusive Green Finance (IGF)

Discuss and create financial policies that build resilience and to mitigate the effects of climate change. [28]

SME Finance (SMEF)

Promote the discussion and implementation of smart policy frames that facilitate access of micro, small, and medium enterprises (MSMEs) to finance, and provide a platform for members to discuss related challenges and opportunities.[29]

Global Policy Forum

Main article: AFI Global Policy Forum

The Global Policy Forum (GPF) is organized annually by AFI and is the keystone event for its membership and financial inclusion policymakers globally.

The first GPF was co-hosted by the Central Bank of Kenya in September 2009 in Nairobi, Kenya, and attracted nearly 100 central bankers and other financial policymakers,[30] providing a platform for policymakers in developing countries to engage in dialogue and share knowledge and experiences in expanding access to financial services.[31] In his opening remarks, CBK Governor Prof. Njuguna Ndung'u summarized the goal of the GPF when he stated: "We will, over the next three days, share experiences on smart financial inclusion policies that have worked elsewhere. We will thereafter adopt these policies to suit our respective countries as we work together to push forward the global financial access frontiers."[32]

Members

AFI's members consist of central banks, monetary authorities, and other financial institutions. AFI members are responsible for choosing the policies to focus on.[33]

Principal and associate members
Country Principal Members Associate Members
 Afghanistan Da Afghanistan Bank
 Angola Banco Nacional de Angola
 Armenia Central Bank of Armenia
 Bahamas Central Bank of The Bahamas
 Bangladesh Bangladesh Bank
  • Insurance Development and Regulatory Authority of Bangladesh
  • Microcredit Regulatory Authority
  • Ministry of Finance of Bangladesh
 Belarus National Bank of the Republic of Belarus
 Bhutan Royal Monetary Authority of Bhutan
 Burkina Faso Ministère de l’Economie et des Finances du Burkina Faso
 Burundi Banque de la République du Burundi
 Cambodia National Bank of Cambodia Securities and Exchange Commission of Cambodia
 China
  • People's Bank of China
  • China Banking Regulatory Commission
 Colombia Banca de las Opportunidades
 Democratic Republic of Congo Banque Centrale du Congo
 Costa Rica PSuperintendencia General de Entidades Financieras de Costa Rica
 Côte d'Ivoire Ministère de l’Économie et des Finances de la Côte d'Ivoire
 Ecuador Superintendencia de la Economía Popular y Solidaria de Ecuador
 Egypt Central Bank of Egypt
 El Salvador Banco Central de Reserva de El Salvador
 Ethiopia National Bank of Ethiopia
 Eswatini Ministry of Finance - Eswatini Central Bank of Eswatini
 Fiji Reserve Bank of Fiji
 Gambia Central Bank of The Gambia
 Ghana
  • Bank of Ghana
  • Ministry of Finance and Economic Planning
 Guinea Banque Centrale de la République de Guinée
 Haiti Banque de la République d'Haiti
 Honduras Comisión Nacional de Bancos y Seguros de Honduras
 India Reserve Bank of India
 Jordan Central Bank of Jordan
 Kazakhstan National Bank of Kazakhstan
 Kenya Central Bank of Kenya
  • Sacco Societies Regulatory Authority (SASRA) Kenya
  • Retirement Benefits Authority of Kenya
 Kyrgyz Republic National Bank of the Kyrgyz Republic State Service of Regulation and Supervision for Financial Markets
 Lesotho Central Bank of Lesotho
 Liberia Central Bank of Liberia
 Madagascar
  • Banque Centrale de Madagascar
  • Direction Générale du Trésor
  • Ministère des Finances et du Budget, Madagascar
 Malawi Reserve Bank of Malawi
 Malaysia Bank Negara Malaysia
 Maldives Maldives Monetary Authority
 Mauritania Banque Centrale de Mauritanie
 Mexico Comisión Nacional Bancaria y de Valores
 Mongolia Financial Regulatory Commission of Mongolia
 Morocco Bank Al-Maghrib
 Mozambique Banco de Moçambique
 Namibia Bank of Namibia
   Nepal Nepal Rastra Bank
 Niger Ministère des Finances de la République du Niger
 Nigeria Central Bank of Nigeria Nigeria Deposit Insurance Corporation
 Pakistan State Bank of Pakistan
 Palestine Palestine Monetary Authority
 Papua New Guinea Bank of Papua New Guinea
 Paraguay Banco Central del Paraguay
 Peru Superintendencia de Banca, Seguros y AFP del Perú
 Philippines Bangko Sentral ng Pilipinas
 Russia Central Bank of the Russian Federation
 Rwanda National Bank of Rwanda
 Samoa Central Bank of Samoa
 São Tomé and Príncipe Banco Central de São Tomé e Príncipe
 Senegal Ministère de l'Economie, des Finances et du Budget du Sénégal
 Seychelles Central Bank of Seychelles
 Sierra Leone Bank of Sierra Leone
 Solomon Islands Central Bank of Solomon Islands
 South Africa National Treasury of the Republic of South Africa South African Reserve Bank
 Sri Lanka Central Bank of Sri Lanka
 Sudan Central Bank of Sudan
 Suriname Centrale Bank van Suriname
 Syria Central Bank of Syria
 Tajikistan National Bank of Tajikistan
 Tanzania Bank of Tanzania Social Security Regulatory Authority of Tanzania
 Thailand NBank of Thailand
 Timor-Leste Banco Central de Timor-Leste
 Togo Ministère de l'Economie et des Finances du Togo
 Tonga National Reserve Bank of Tonga
 Trinidad & Tobago Central Bank of Trinidad and Tobago
 Tunisia
  • Banque Centrale de Tunisie
  • Ministère des Finances de la République Tunisienne
 Autorité de Contrôle de la Microfinance de la République Tunisienne
 Uganda Bank of Uganda Insurance Regulatory Authority of Uganda
 Uzbekistan Central Bank of the Republic of Uzbekistan
 Vanuatu Reserve Bank of Vanuatu
 Yemen Central Bank of Yemen
 Zambia Bank of Zambia, Ministry of Finance
 Zimbabwe Reserve Bank of Zimbabwe

Donors and partners

In 2016, AFI completed its transition from being an exclusively donor-funded project into an independent and member-supported international network of policymakers. However, AFI still continued to form strategic collaborations with a variety of global donors and partners from both the public and private sectors. These include:[34][35]

AFI also partners with a number of organizations with an interest in financial inclusion, from inter-governmental and standard-setting bodies (SSBs) to development banks, development agencies, research organizations, industry associations, and the private sector. AFI partners include Ant Financial, Mastercard, Visa, GSM Association, Women's World Banking, Thunes, G20, and G24. Each partner contributes unique knowledge, resources, and expertise to support AFI programs and activities.

See also

References

  1. ^ Alliance for Financial Inclusion Official Website
  2. ^ "World's largest financial inclusion forum set to open in Rwanda". Retrieved 2020-06-18.{{cite web}}: CS1 maint: url-status (link)
  3. ^ Andrew Ross Sorkin (21 September 2009). "Gates Foundation Pledges $35 Million for Banking Innovation". Venture capital: DealBook. New York Times. Retrieved 21 August 2013. Alfred Hannig, executive director of the Alliance for Financial Inclusion, said banking innovation is happening in developing countries
  4. ^ "Gates Foundation Financial Services for the Poor Partners Page". Archived from the original on 2013-03-29. Retrieved 2013-03-27.
  5. ^ Alliance for Financial Inclusion (2016). "Annual Report 2015" (PDF): 3. Retrieved 20 August 2019. {{cite journal}}: Cite journal requires |journal= (help)
  6. ^ "AFI Data Portal".
  7. ^ "AFI turns 10". Retrieved 2020-06-20. {{cite web}}: Cite has empty unknown parameter: |1= (help)
  8. ^ "Australian Government AusAid". Archived from the original on 2013-06-27. Retrieved 2013-03-27.
  9. ^ "Maya Declaration". Retrieved 2020-06-13. {{cite web}}: Cite has empty unknown parameter: |1= (help)
  10. ^ "G20 Official Outcome Statement, Article 10" (PDF). Archived from the original (PDF) on 2013-06-25. Retrieved 2013-04-25.
  11. ^ "Sasana Accord on Evidence- and Data-based Results, Accelerated Progress and Measurement of Impact" (PDF).
  12. ^ The Trinidad and Tobago Guardian: Central Bank of T&T joins AFI
  13. ^ "Denarau Action Plan for Gender Inclusive Finance".
  14. ^ "Sharm El Sheikh Accord on Financial Inclusion, Climate Change and Green Finance" (PDF).
  15. ^ "Sochi Accord on FinTech for Financial Inclusion" (PDF).
  16. ^ [hhttps://www.afi-global.org/news/2019/09/luxembourg-signing-will-help-bolster-financial-inclusion-across-african-continent "SLuxembourg signing will help bolster financial inclusion across the African continent"].
  17. ^ "Coronavirus (COVID-19) outbreak".
  18. ^ "27 cases of viral pneumonia reported in central China's Wuhan City".
  19. ^ "Worldmeter's COVID-19 coronavirus pandemic". Retrieved 2020-06-19.
  20. ^ "AFI COVID-19 Policy Response". Retrieved 2020-06-19.
  21. ^ "AFI COVID-19 Policy Response in Africa". Retrieved 2020-06-19.
  22. ^ "CAFI Annual Report 2018" (PDF).
  23. ^ "Consumer Empowerment and Market Conduct (CEMC) Working Group 2020 Factsheet".
  24. ^ "Digital Financial Services (DFS) Working Group 2020 Factsheet".
  25. ^ "Financial Inclusion Data (FID) Working Group factsheet".
  26. ^ "Financial Inclusion Strategy (FIS) Peer Learning Group 2020 Factsheet".
  27. ^ "Global Standards Proportionality Working Group 2020 Factsheet".
  28. ^ "Inclusive Green Finance (IGF) working group fact sheet 2020".
  29. ^ "Inclusive Green Finance (IGF) working group fact sheet 2020".
  30. ^ Bill & Melinda Gates Foundation: AFI Develops Financial Services for the Poor [1]
  31. ^ GSMA: Highlights from 2009 Alliance for Financial Inclusion Global Policy Forum [2] Archived 2013-05-13 at the Wayback Machine
  32. ^ Central Bank of Kenya: Governor's Remarks at the 2009 AFI Global Policy Forum [3]
  33. ^ AFI Member Map[4]
  34. ^ https://www.afi-global.org/partners
  35. ^ https://www.afi-global.org/sites/default/files/publications/2019-09/AFI_AR18_stg11.pdf
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