Luxembourg signing will help bolster financial inclusion across the African continent

On 6 September 2019 the Ministry of Finance of the Grand Duchy of Luxembourg signed a letter of understanding (LOU) with the Alliance for Financial Inclusion (AFI) to launch a new multi-donor collaboration framework that will help bolster financial inclusion across the African continent.

Through the newly created Multi-Donor Financial Inclusion Policy Implementation Facility (“MD-PIF”), AFI and Luxembourg will help develop and implement policies that foster financial inclusion with a focus on gender equality, including digital financial innovation and FinTech, Financial Education and SME Finance. The framework will play an important part in the development of a vibrant, innovative, sustainable and competitive financial sector in Africa at both national and regional levels.

Minister Gramegna is the first MD-PIF partner to sign the multilateral LOU, together with AFI Executive Director Dr. Alfred Hannig. Alongside Luxembourg, the Development Agency of France (AFD), and Germany’s Ministry of Economic Cooperation and Development (BMZ) also participate in this new framework. The cooperation is rooted in the three partner’s support toward the advancement of the Sustainable Development Goals (SDGs), particularly on poverty alleviation, gender equality and climate action respectively.

Luxembourg will make available to the MD-PIF an overall amount of EUR 1.2 million (to be paid in three yearly tranches each in the amount of EUR 400,000). Luxembourg’s participation is highly strategic for AFI not only as a funding partner but also for its intellectual and technical capacity. AFI members will benefit from the insight and engagement of many government-supported institutions, from academia to its FinTech and microfinance ecosystems, as well as private actors of the country’s leading financial centre.

Minister Gramegna said: “The launch of this new multi-donor collaboration framework underlines Luxembourg’s commitment to join forces with like-minded partners in the promotion of economic, social and environmental sustainability. By providing technical and financial assistance through this new framework, Luxembourg will help develop the necessary regulatory frameworks and supportive infrastructure to foster financial inclusion across Africa.”

“AFI is a global policy leadership alliance that offers global solutions for local challenges. Thanks to MD-PIF and partners, like the Ministry of Finance of Luxembourg, our members in Sub-Saharan Africa and the Arab region are able to continue receiving tailor-made, in-country policy implementation assistance and persist in drawing from AFI’s knowledge and experience,” AFI Executive Director Dr. Alfred Hannig said.

“With MD-PIF in place, AFI members will continue to drive change, especially in digital financial services, poverty alleviation, gender inclusive finance, inclusive green finance,” Dr. Hannig added.

MD-PIF’s initial phase is expected to run for three years (2019-2021). Among its key features is to support in-country policy implementation activities, create synergies with the partners and investees of the MD-PIF funders and to provide cost-effective donor engagement opportunities that generate strong development outcomes.

Signatories from Germany and France are expected at next week’s 2019 AFI Global Policy Forum (GPF), AFI’s flagship event and the world’s biggest forum for financial inclusion policymakers, which will be held in Rwanda this year.

AFI members collectively comprise the largest year-on-year funding contribution to the programs and activities in the network. However, to further advance the implementation of financially inclusive policies in key areas — such as gender inclusive finance, inclusive green finance and digital financial services —, AFI has formed strategic collaborations with a variety of donors and partners from both the public and private sector.

About the Alliance for Financial Inclusion (AFI)

AFI is the world’s leading organization on financial inclusion policy and regulation. Roughly 100 member institutions make up the AFI network including central banks, ministries of finance and other financial regulators from over 80 developing and emerging countries. AFI works on empowering policymakers to increase access and usage of quality financial services for the underserved through formulation, implementation and global advocacy of sustainable and inclusive policies.

About the AFI Global Policy Forum (GPF)

The GPF – the highlight in the financial inclusion calendar – showcases the progress and achievements made by AFI’s vibrant global network of roughly 100 member institutions from nearly 90 countries. Held annually, it is the most important and comprehensive forum for regulatory institutions to share experiences, knowledge and initiatives. Over the past decade, the event has supported an environment of historic financial inclusion policy initiatives and declarations, most notably the Maya Declaration, the first global and measurable set of financial inclusion commitments by developing and emerging economies.