A panel of United Nations finance experts has issued a set of recommendations on how governments, regulators, development partners and the private sector can enable the world’s poor to better access financial services.
At its meeting in New York last week, the UN Advisors Group on Inclusive Financial Sectors – established following the 2005 International Year of Microcredit – considered a range of issues related to inclusive finance.
Citing examples from the developing world, the Group noted that a microfinance scheme in five sub-Saharan countries had doubled the level of savings between 1998 and 2006 and had the potential to double it again in the next three years. There was a huge opportunity to expand micro-insurance from its current level of only two per cent of poor households, the Group stated, adding that housing loans to poor people could have a major impact.
In addition, the panel argued that providing mobile-phone services to people without bank accounts had been successful in Kenya and that micro-finance initiatives could be effective even in societies affected by conflict such as Afghanistan.
According to the group, it is estimated that over two billion people are currently excluded from access to financial services. The situation is particularly dire in most least developed countries (LDCs) where more than 90 per cent of the population is often excluded from access to the formal financial system.
Last week’s meeting marked the end of the two-year mandate for the group, which includes representatives from governments, central banks, regulatory agencies, microfinance institutions, the private sector, civil society and donors.