The main implementing mechanism of the action plan is a new Global Partnership for Financial Inclusion (GPFI) to be formulated by the G20 nations in collaboration with the Alliance for Financial Inclusion (AFI), the Consultative Group to Assist the Poor (CGAP), and the International Finance Corporation (IFC). The GPFI will be an inclusive platform for G20 countries, non-G20 countries, and relevant stakeholders for peer learning, knowledge sharing, policy advocacy and coordination.

 

More than two billion people worldwide go without access to formal financial services – many of these are the world’s poorest, and most live outside G20 countries. The G20 recognizes the importance of enhancing the role of developing countries in deepening and stabilizing the global financial system, and accelerating economic growth to eradicate poverty. In this context the G20 action plan explicitly requests that AFI facilitate the participation of non-G20 developing country financial policymakers into the activities of the GPFI. It also additionally requests that AFI’s unique peer-to-peer learning model be scaled up and used as a key way to spur financial inclusion policy innovation globally.

 

This request is the result of an ongoing G20 dialogue process that AFI member institutions have engaged in over the past year, since financial inclusion first emerged as an agenda point at the G20 Pittsburgh Summit in 2009. The G20 Financial Inclusion Experts Group, responsible for the development of the action plan, utilized many of AFI’s ongoing programs as inputs for the process, including dialogues and meetings with developing country policymakers and the annual AFI Survey on Financial Inclusion Policy in Developing Countries. 

 

Central to the action plan is the implementation of the “Principles for Innovative Financial Inclusion” as endorsed at the G20 Toronto Summit in June. These nine Principles provide guidance for policymakers as they look to implement safe and sound policies to expand the use and access to financial services. Central Principles include leadership and broad based government commitment to financial inclusion, diversity in the services delivered and the range of service providers, and innovation both in the use of technology and use of new institutional approaches. The Principle of protection emphasizes the need for partnership among governments, private sector, and consumers to enhance consumer protection in financial services. The Principles draw on the experiences of countries already pioneering policy and regulatory responses to include the world’s poorest in the financial system.

 

One of the first action items for the GPFI is to create a financial inclusion data and measurement task force to improve the quality and quantity of financial inclusion data relevant for households, individuals, and micro-to-small enterprises. This task force will dovetail with AFI’s financial inclusion data working group  which has been undertaking knowledge-sharing activities on financial inclusion data issues, methodologies, and global standards and principles thereby capturing developing country policymaker needs and perspectives at its very core.

 

Another key priority for the GPFI is to provide tools and resources for countries to set financial inclusion targets. By not committing to a single aggregated global target for financial inclusion in a defined time frame, the G20 has empowered non-G20 developing countries to create their own strategies and related self-set targets that reflect their unique circumstances and objectives – which will result in more ownership and commitment at the national level.

 

AFI welcomes the new GPFI and is committed to helping facilitate developing country policymaker participation over the coming year. This innovative partnership approach to tackling poverty through a more inclusive financial sector will draw on the strengths of all actors to move the agenda forward.