Global Leaders Issue Commitments to Universal Financial Access by 2020

Jim Yong Kim, President of the World Bank Group

> Posted by Center Staff

Among the excitement of the World Bank Spring Meetings last week, key players in financial inclusion declared actionable commitments toward the goal of universal financial access by 2020 in a standout session. Those committing included banks, associations, payment companies, and telcos. The message of the commitments, and of the session’s panel discussion, was that we’ve achieved remarkable progress in the past few years, the goal of universal access by 2020 is very much in reach, and both of these are due in no small part to the aligning of stakeholder incentives and powerful partnerships. The panel highlighted that in three short years, the number of unbanked adults around the world dropped from 2.5 billion to 2.0 billion, according to the 2014 Global Findex.

The focus of the panel was mobilizing the public and private sectors to achieve the goal of universal financial access. Although achieving access is just the first step toward inclusion, it is a bridge to effective services usage, as well as to other development objectives like adequate housing, education, clean water, and healthcare. During the session, panelist Jim Yong Kim, President of the World Bank Group said, “If we reach universal financial access by 2020, we’re going to have a much better chance of getting to the end of poverty by 2030.” One particularly promising avenue to expanding access is digitizing government payments. Ajay Banga, CEO of MasterCard shared that 30 percent of the money that flows into the hands of the under-banked comes from governments. Delivering these payments into a mobile phone, card, or cloud-based account that can be accessed using biometric technology or other non-limiting customer-identification methods brings tremendous benefits. In this way, by migrating their social benefits from cash to electronic, Pakistan opened 3 million debit accounts in six months. Countries with national financial inclusion strategies achieve twice the increase in the number of account-holders compared to countries that don’t have strategies in place.

In Indonesia, where only 60 million, or about a quarter of the population, has financial access, the government recently passed enabling regulation on agent, branchless, and mobile banking, and partnered with the country’s three-biggest mobile network operators (covering about 90 percent of the market) to distribute the government’s conditional cash transfers. Panelist Budi Gunadi Sadikin, President of Indonesia’s Bank Mandiri indicated that the project is aiming to reach 15.5 million of the country’s poorest families this year. Her Majesty Queen Maxima of the Netherlands, UNSG’s Special Advocate for Inclusive Finance for Development emphasized the role of governments, regulators, and supervisors in supporting an environment for responsible, transparent, competitive, and scalable private sector activity. Banga noted that partnerships aren’t just between the public and private sectors, but also between private players along with NGOs and opinion leaders.

For more on the session discussions, watch the full video recording here.

As reported during the session, here are the commitments towards universal access by 2020:

  • The World Bank Group – Support national authorities and the private sector to reach up to one billion people who are financially excluded
  • MasterCard – Reach a total of 500 million individuals through their programs
  • Visa – Provide electronic payment accounts to 500 million underserved people
  • Bandhan – 20 million savings accounts and 10 million credit customers
  • Equity Bank – Reach 50 million clients in Africa
  • Global Banking Alliance for Women – Provide financial access to 1.8 million women in Latin America and Africa
  • Microfinance CEO Working Group – 70 million new accounts around the world
  • Microcredit Summit Campaign – Expand their outreach to at least 53 million of the world’s poorest families
  • Ooredo – 17 million mobile financial service customers
  • Telenor – 50 percent of its customers to use their mobile phones for financial services
  • World Council of Credit Unions – Reach an additional 50 million people through credit union services
  • WSBI – Committed to the goal of “an account for everyone” building on its member institutions base of 950 million customers

With the World Bank Spring Meetings at a close, and our better sense of progress thanks to the new Global Findex, it feels as though we’ve entered a new phase in the quest to achieve financial inclusion. It’s outstanding to see that in the months and years ahead, support and enthusiasm for this goal, across sectors and industries, has reached new heights.

Have you read?

Sixty-Two Percent of the World Is Banked, the New Global Findex Finds

Where Is Microfinance Heading and Are Partnerships the Answer?

Newsflash: World Bank President Sets Goal of Universal Financial Access by 2020

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