1 - 7 June | Financial Inclusion Weekly News

Africa

• Egypt - The Central Bank of Egypt (CBE) joined the Network for Greening the Financial System (NGFS) in May 2022 to enhance its financial sector's role in sustainable development and climate risk management. The CBE has integrated Environmental, Social, and Governance (ESG) factors within Egypt's financial ecosystem, issuing Sustainable Finance Guiding Principles and Binding Regulations on Sustainable Finance. The CBE leverages NGFS insights for climate stress testing and capacity building, aligning with national strategies like Egypt Vision 2030 and the National Climate Change Strategy 2050. - Central Bank of Egypt
• Ghana - Dr. Paa Kwesi Nduom, founder of the defunct Groupe Nduom Savings and Loans, emphasized the widening gap between banked and unbanked populations in Ghana due to the absence of GN Bank . Since the bank's collapse in 2019, no financial institutions have established branches in rural areas, leaving a significant void. GN Bank was the sole financial institution in many rural regions, supporting small businesses and the agricultural sector. The bank is currently seeking to revive its license to restore these crucial services. Community members like Nana Yaw Mintah and Abena Ofori highlight the difficulty in accessing credit since GN Bank's closure. - MSN
• Nigeria - At the Regtech Africa Conference in Lagos, Branka Mracajac , CEO of 9 Payment Service Bank (9PSB), emphasized that financial inclusion is crucial for poverty reduction and economic prosperity in Africa. She highlighted the need for accessible and affordable financial services for unbanked and underserved populations. Despite progress, with financial exclusion in Nigeria decreasing from 53% in 2008 to 36%, significant barriers remain. Mracajac called for enhanced financial literacy, reduced costs, and increased trust in financial institutions to achieve the Central Bank of Nigeria's 25% financial inclusion target. - Tech Economy .
• VERITAS GLANVILLS PENSIONS (VG Pensions) is leading the way in promoting financial inclusion in Nigeria through the Micro Pension Plan (MPP), a scheme introduced in 2019 tailored for self-employed individuals and those in small enterprises. The MPP offers flexible contribution options (daily, weekly, monthly) and divides contributions into Contingent Contributions (40%, accessible for immediate needs) and Retirement Benefit (60%, accessible at retirement or due to health reasons). The initiative has significantly grown, with over 114,000 contributors and substantial pension contributions. VG Pensions continues to provide seamless pension services and secure investments for their clients. - ThisDay Live
• Access Bank Plc 's 'W' Initiative addresses the financing gap for women by offering tailored banking solutions and fostering a supportive community. Launched officially in 2014, the initiative includes various programs like the 'W' Academy, Womenpreneur Pitch-a-ton, W Health Loans, and W Health Month. These programs provide financial services, health support, educational programs, and networking opportunities. The initiative has supported thousands of female entrepreneurs and aims to expand its reach across Africa, contributing to broader economic development and gender equality. This Day Live
• Kenya - The proposed 16% Value Added Tax (VAT) on financial services in Kenya, included in the Finance Bill 2024, threatens to hinder financial accessibility and stability. Currently, financial services enjoy VAT exemption, contributing to an increase in financial access from 27% in 2006 to 84% in 2021. Introducing VAT on these services could push consumers towards informal financial services, undermining financial inclusion initiatives and economic empowerment, especially for marginalized communities. This additional tax burden, coupled with the existing 20% Excise Duty, could significantly impact low and middle-income individuals, increasing financial disparities. - The Kenya Time.
• At the Africa Bank 4.0 Summit in Nairobi, South African fintech Omnisient - Collaborative Consumer Intelligence was celebrated for enhancing financial inclusion by enabling banks to use consumer shopping behavior to assess credit risk. This innovative approach has allowed banks to evaluate the economic reliability of 8 million people without formal credit histories, qualifying 3.2 million for credit. Omnisient's platform anonymizes consumer data, ensuring privacy and compliance with global regulations, while supporting over 160 million consumer records across Africa. This initiative opens new markets for banks and improves economic mobility for millions. - ITWeb
• Uganda - Equity Bank Uganda received an award from the UGANDA FINANCIAL LITERACY ASSOCIATION (UFLA) for its efforts in promoting financial education and inclusion. The bank has reached 67% of rural and 32% of urban areas, targeting unbanked populations like women, youth, and refugees. It has trained over 126,000 individuals, resulting in increased access to affordable credit and job creation, with UGX 89 billion disbursed and 99,000 jobs created over the last three years. The award reaffirms Equity Bank's commitment to fostering economic growth and improving livelihoods in Uganda. - PML Daily
• Namibia - Despite 78% of Namibians being covered by financial inclusion initiatives, rural areas still face significant challenges. Bank of Namibia Governor Johannes Gawaxab highlighted that 62% of rural residents primarily use cash, necessitating long and costly trips to financial institutions. High fees and charges deter formal banking use, and carrying cash poses security risks. Financial inclusion is crucial for regions like Ohangwena, Omusati, Oshikoto, and Oshana, which rely on subsistence farming and are vulnerable to climate change. The symposium at Namibia University of Science and Technology called for effective economic development initiatives to empower rural communities. - Observer
• Ethiopia - Hibret Bank in collaboration with 萬事達卡 , has launched the Prepaid Hibir Mastercard in Ethiopia, aimed at enhancing digital financial inclusion. This card allows secure and convenient international banking services for Ethiopians, supporting both contact and contactless transactions. It marks a significant step towards increasing financial access in Ethiopia, which aims for 70% financial inclusion by 2025. Mastercard
• South Africa - The South African Reserve Bank (SARB) has unveiled a national digital payments roadmap to enhance financial inclusion and shift towards a cashless economy. Key features include the adoption of two-factor authentication for security and a digital KYC registry to streamline identity verification for transactions. The roadmap aims to promote competition, innovation, cost-effectiveness, interoperability, and financial inclusion, aligning with South Africa’s 2035 Vision. Stakeholders include financial regulatory authorities, government departments, fintechs, and mobile money operators. The initiative seeks to overcome barriers to digital payment adoption, expanding accessibility and modernizing payment infrastructure. - Biometric Update

Regional

Generational Wealth: Enabling Economic Prosperity and Inclusion for the Future

Creating generational wealth is crucial for Africa's economic growth, as highlighted by Dr. Dr Owen Young of 渣打银行 . Prominent examples include Aliko Dangote and Strive Masiyiwa . Key steps include quality education, financial literacy, homeownership, and entrepreneurship. Addressing historical injustices, robust infrastructure investment, and adaptable entrepreneurs are essential. Legal advice for asset transfer, financial planning, and modern technology like blockchain are vital. Empowering women and providing access to credit, especially for SMEs and agriculture, can drive inclusive growth. Initiatives like SC Shilingi Funds in Kenya enhance financial literacy and access. - International Banker

Middle East

• Saudi Arabia, Bahrain, and Oman - The rapid growth of the digital economy in the GCC region, driven by government initiatives, regulatory support, and the adoption of digital payments, is being further accelerated by fintech innovations. These advancements are extending digital commerce benefits to more consumers and businesses, fostering increased financial inclusion and economic innovation. Governments, such as the Saudi Central Bank – SAMA have established enabling environments through sandboxes and licensing guidelines. However, fintechs face challenges like global competition for tech talent and complex cross-border regulations. Addressing these issues and enhancing collaboration between private and public sectors can maximize fintech's potential. - Saudi Gazette
• Qatar - Qatar Islamic Bank (QIB) won the "Best App to Encourage Financial Inclusion" award from Global Finance Magazine for its QIB Lite App. The app, a simplified and multilingual version of the QIB Mobile App, enhances financial accessibility for workers. This recognition underscores QIB's commitment to digital innovation and universal financial service access. QIB's initiatives also received regional acclaim from EMEA Finance in March 2024, highlighting its dedication to inclusive financial practices. The Peninsula

Latin America & The Caribbean

• Mexico - Revolut has secured a banking license in Mexico, marking a significant milestone in its expansion. With plans to become a top three bank in Mexico within five years, Revolut aims to capitalize on the country's large unbanked population and the US-Mexico remittance corridor. The company’s strengths lie in offering a comprehensive suite of financial features and free, instant cross-border transfers. Recruitment is underway for various roles as Revolut prepares for its official launch, with goals to foster financial inclusion and transform the local banking landscape. Revolut
• Argentina - The GLI LATAM forum, held in Buenos Aires, focused on promoting gender equality and economic development in Latin America. Key discussions included the financial inclusion of women, with speakers highlighting the need for innovation and action to address gender biases in financial services. The forum emphasized the importance of women's participation in senior roles and their access to technological tools and capital. Participants called for creating an ecosystem of impact to drive financial inclusion and economic autonomy for women. Medium

Asia

• Malaysia - Financial inclusion in Malaysia faces significant challenges, with only 39% of the population having access to bank loans and a 55% underbanked adult population. The government, alongside agencies like Bank Negara Malaysia and the Securities Commission, has launched initiatives such as the National Strategy for Financial Literacy (2019–2023) to enhance digital banking and financial literacy. Recommendations for improvement include enhancing digital banking infrastructure in underserved areas, incorporating financial literacy into educational curricula, and supporting collaborative efforts between institutions. These measures aim to promote financial services for unbanked individuals and drive long-term economic growth. Bernama
• Taiwan - Tether.io has invested $18.75M in XREX Inc. Group, a regulated blockchain-enabled financial institution, to drive financial inclusion in emerging markets. This investment aims to facilitate USDT-based cross-border payments, launch a stablecoin, and innovate in Regulatory Technology. The collaboration seeks to improve financial transactions and regulatory compliance, fostering a safer and more accessible environment for crypto users in emerging markets. Morningstar

• Samoa - The National Bank of Samoa (nbs), supported by IFC - International Finance Corporation and the New Zealand Government, is developing new banking products to benefit women entrepreneurs and improve remittances. These include tailored financial offerings and a pioneering remittance product designed for Samoans. The initiative aims to foster financial inclusion, enabling more Samoans to embrace banking and access economic opportunities. IFC's support builds on successful initiatives in Tonga and includes enhancing risk management and gender finance services. This collaboration aims to increase financial inclusion and support economic growth in Samoa. - IFC Press Room
• Philippines - Rural, thrift, and community banks in Southeast Asia, particularly the Philippines, are vital for financial inclusion, providing access to lending and potential wealth creation for many. The rise of Open Banking and the high penetration of smartphones present opportunities and challenges for these banks. They must adopt a tech stack that reduces layers between customer interfaces and back-office operations, captures conversational data, and integrates diverse data sources through APIs. This approach will help these banks improve deposit and lending flows, manage risks, and support growth, ultimately fostering financial inclusion and economic development. - Finextra
• Vietnam - Home Credit Vietnam highlights the collaborative journey required for financial inclusion, emphasizing the need for involvement from the government, educational institutions, the business community, and citizens. At the Financial Empowerment Network Summit, nearly 100 industry leaders discussed enhancing the financial well-being of Vietnamese people. Initiatives like financial literacy programs, personalized financial solutions, and partnerships with local organizations were showcased. Despite progress, continuous efforts in financial education and support are essential for broader and more effective financial inclusion. - VnExpress
• India - Digital payment frauds have surged more than fivefold to 14.57 billion rupees ($175 million) in the fiscal year ending March 2024, according to the Reserve Bank of India (RBI) annual report. This spike coincides with the rapid growth of the Unified Payments Interface (UPI), which saw a 137% increase in transactions over the past two years, reaching 200 trillion rupees. Factors like affordable internet access and greater financial inclusion have boosted digital payment popularity but also attracted fraudsters. Despite awareness campaigns by the RBI, digital payments accounted for 10.4% of total fraud amounts in 2024, up from 1.1% the previous year. Enhanced security measures and user awareness are urgently needed to combat this growing threat. - Business Today.
• Banking-as-a-Service (BaaS) enables non-banking financial companies (NBFCs) to offer banking services like payments, loans, and accounts through APIs. This collaboration between traditional banks and fintech companies is overseen by the Reserve Bank of India (RBI) . BaaS offers enhanced e-commerce experiences, fintech innovation, streamlined SME banking, and next-gen banking solutions, promoting financial inclusion. However, it also presents challenges like regulatory uncertainty and security concerns. Indian BaaS startups like OneStack , Setu , and Zeta are driving this transformation, aiming to serve the large underbanked population. - Inc42.
• Political party manifestos reveal diverse approaches to financial inclusion, a key aspect of leading a dignified life. The BJP's 2024 manifesto prioritizes digital financial inclusion, emphasizing easier credit, cash transfers, and digital social security schemes, while earlier promises like equal pay and women's property rights take a backseat. In contrast, the INC's manifesto focuses on rights-based measures such as equal pay, social security for gig workers, and legal backing for MSP, though it drops previous promises like farmer debt waivers. The NCP and CPI(M) propose innovative measures like gender budgeting, green credits for farmers, and religion-based priority sector lending. Essential measures for financial inclusion that should be universally adopted include early financial literacy, effective grievance redressal mechanisms for financial fraud, and designing suitable financial products using gender-disaggregated data. Vidhi Legal Policy
• Fintech firms in India are using AI and ML for underwriting to enhance financial inclusion for startups by efficiently assessing risks and facilitating quicker access to funds, thus supporting the burgeoning fintech market expected to reach $150 billion by 2025. Express Computer

Regional

• AI to Revolutionize Banking, Boost Financial Inclusion The integration of AI in banking operations is transforming efficiency, expanding access to credit, and promoting financial inclusion. Intelligent Document Processing (IDP) systems automate data extraction, improving accuracy and compliance. AI solutions like those used by LendMN evaluate creditworthiness for individuals with limited credit history, broadening access to loans. The upcoming advancement to Artificial General Intelligence (AGI) could further personalize financial services and enhance economic opportunities for the underbanked. Financial inclusion is a powerful economic driver, fueling entrepreneurship, investment, and consumption. Fintechs like GCash are partnering with microfinance institutions to provide microloans to unbanked individuals, fostering a more inclusive financial landscape. - The Manila Times

Rest of the world

• Moldova - Moldcell has launched a range of digital tools and services, including 5G and mobile financial services, to foster digital and financial inclusion in Moldova. Through initiatives like the Moldcell Foundation and projects such as "Like from Grannies" the company aims to empower the Moldovan population, support startups, and drive economic growth by leveraging technology and high-speed connectivity. European CEO
• United Kingdom - SaaScada has partnered with ZORRZ Finance UK Ltd to launch the BlueAccess Card, a collateralized credit card aimed at individuals excluded from traditional lending due to their credit histories. The card offers no monthly fees or high-interest rates and avoids traditional credit checks. It provides flexible repayment options, including Buy Now, Pay Later, and leverages SaaScada’s real-time data capabilities to help users manage their finances effectively. - Retail Banker International.
• Financial Conduct Authority and Prudential Regulation Authority (PRA) announced they will not proceed with the proposals for mandatory data gathering and diversity target setting in financial services, following mixed responses and concerns about compliance costs. Instead, they will focus on tackling non-financial misconduct such as harassment and discrimination. The FCA aims to ensure senior leadership takes greater responsibility for improving diversity and inclusion. Firms are advised to consider internal measures to understand their workforce and prepare for upcoming legislative changes, including a new duty to prevent sexual harassment from October 2024 and proposed ethnicity pay gap reporting. - Clyde & Co
• Socially minded investors are funding organizations offering fair and affordable credit to those in need, bypassing predatory lenders. Ethex , a crowdfunding platform, enables everyday people to invest in companies committed to social change. These ethical finance companies, such as Great Western Credit Union and Fair for You CIC , provide accessible financial products to individuals with low or no credit scores. For instance, Salad Money , the UK's largest community development finance institution (CDFI), lends money to those with poor credit, using open banking to assess their financial behavior rather than traditional credit scores. This approach helps financially vulnerable individuals avoid high-interest loans and gain access to necessary benefits. Despite a high APR of 79.5%, Salad Money's loans are significantly cheaper than payday loans, offering a fairer borrowing option. Investments through Ethex support such ethical initiatives, promoting financial equality and inclusion - Positive News
• Monzo , the British fintech startup, has reported its first full year of profitability with a pre-tax profit of ￡15.4 million ($19.6 million) for the 2023-2024 fiscal year. This turnaround from a ￡116.3 million loss the previous year highlights the company's strategic focus and ability to navigate the complexities of the financial services industry. Monzo’s revenue more than doubled to ￡880 million, driven by growth in lending, subscription services, and a customer base expansion of 2.3 million new customers. Despite challenges like regulatory scrutiny and the cost-of-living crisis, Monzo is poised for further growth, including plans for international expansion and a potential public listing. The Global Treasurer
• Plain Numbers, a UK-based consultancy, has teamed up with Visa to enhance financial inclusion and improve the design of government disbursements. This partnership aims to provide user-friendly and accessible financial services, facilitating better money management and financial planning for individuals, particularly vulnerable groups. It marks a significant step towards creating a more inclusive financial system in the UK. The Paypers
• Scotland - Financial Inclusion for Scotland (FIFS) is advocating for the allocation of dormant assets to address financial exclusion and reduce the "poverty premium." They propose a ￡20m fund to support community lenders and affordable credit access. - BBC Scotland News
• France - Banks’ Liquidity in Volatile Macroeconomic and Market Environments Agnès Bénassy-Quéré , Second Deputy Governor of the Banque de France , discussed the importance of liquidity in banks' operations during a joint conference by the Basel Committee, BIS, and CEPR. Highlighting the lessons from the 2007/2008 financial crisis, she stressed the need for robust liquidity regulations like Basel 3's liquidity ratios. She addressed unintended systemic consequences, such as banks hoarding liquidity and trapped liquidity within banking groups. Bénassy-Quéré emphasized the necessity of a macroprudential approach to liquidity, citing the role of central counterparties and investment funds. She also explored the implications of central bank digital currencies (CBDCs) on bank liquidity and the need for new financial frameworks to manage evolving risks. - Banque de France
• United States - Spiral , an Impact-as-a-Service? platform, is gaining popularity with its new financial wellness and personalized banking products, notably the Round Up for Savings feature. This allows users to round up everyday purchases, depositing the spare change into savings accounts and optionally donating a portion to vetted charitable causes. This feature is being adopted by many banks and credit unions, enhancing engagement and attracting younger account holders. Spiral's innovative solutions integrate seamlessly with digital banking platforms, helping financial institutions grow deposits and promote financial wellness and community impact. - Fintech Futures.
• Fund Finance Association 's US Diversity in Fund Finance Committee hosted an event featuring Henry Tang, Co-Founder of the Committee of 100, and Vicky Du, Global Head of Fund Finance at 渣打银行 Bank. Tang, one of the first Asian-Americans on Wall Street, shared his experiences of adversity and discrimination, emphasizing the importance of building relationships and trust. He co-founded the Committee of 100 with prominent Chinese-Americans to foster community and address discrimination. Tang's message underscored the need for continued Diversity, Equity & Inclusion (DE&I) efforts to unlock potential and opportunities for all organizations. - JD Supra
• Open banking is set to revolutionize the U.S. financial landscape, allowing consumers to consent to sharing their financial transaction data with third parties. This digital transformation enables customers to compare bank offerings, transfer accounts easily, and gain a comprehensive view of their finances. Despite the benefits, three-quarters of banks report unpreparedness for open banking, necessitating partnerships with fintechs and data aggregators. Key players like Capital One , 花旗 , 萬事達卡 , and Visa are already leveraging APIs to enhance their services. Regulations, such as the CFPB's Personal Financial Data Rights Rule (1033), aim to protect consumer data and foster competition, requiring the largest U.S. banks to comply by later this year. The European Union's PSD2 and forthcoming Financial Data Access (FIDA) framework further illustrate the global shift towards open banking and open finance - Quartz
• Alternative data is reshaping the traditional credit evaluation landscape by offering a more comprehensive view of consumer financial behavior. Farouk Ferchichi , President of Envestnet | Yodlee , highlights that alternative data—covering transaction history, utility payments, and more—enhances financial inclusion and provides a deeper understanding of creditworthiness, especially for those with thin credit files or near-prime and subprime scores. The integration of this data, supported by regulatory frameworks and technological innovation, benefits consumers by providing fairer credit access and enables financial institutions to improve risk management and discover new markets. Businesses are advised to start with reliable data sets, embrace regulatory compliance, invest in technology and talent, foster partnerships, and prioritize consumer consent and transparency to navigate this evolving landscape effectively. - Forbes

Global

• MD Finance 's latest report highlights fintech companies with strong growth metrics, robust financials, and profitability as the most attractive for funding. The first quarter of 2024 saw nearly 500 fintech deals, indicating a rebound from 2023's $39.2 billion funding slump. Companies in the embedded finance sector, particularly payments and lending, are poised for growth. AI also remains a significant focus, attracting substantial investment. The most promising companies, like Payoneer and KakaoBank, show high EV/revenue ratios and profitability. The US leads in fintech funding, followed by Asia and Europe. Investment is expected to rise in Q3/Q4 as interest rates decrease. - Fintech Future

• Triodos Investment Management 's Fund Manager Tim Crijns explains how microfinance investments in emerging markets offer a favorable risk-return profile, showing low correlation with traditional investments and stable returns. The Triodos Microfinance Fund supports financial institutions in over 40 developing countries, providing loans to small-scale entrepreneurs and farmers, with repayment rates between 95% and 99%. The fund's success in microfinance and renewable energy highlights the importance of addressing country risk and creating positive social and environmental impacts. Crijns emphasizes manual project reviews and primary data assessments to measure the impact accurately, ensuring that investments support sustainable objectives. - Triodos Investment Management
• Wealth management plays a pivotal role in financial inclusion by facilitating access to financial services through new business models and technology. Post-2008 financial crisis, fintech innovations democratized access to financial markets, investment opportunities, and financial advice, helping even those with modest means. Platforms offering low-cost and micro-investment options are empowering individuals to build wealth. Digital banks are reaching unbanked populations, contributing to financial security. Impact investing, which prioritizes ethical and socially responsible investments, is also driving change by directing capital towards initiatives that promote economic inclusion. Wealth managers, through venture capital and advisory support, are empowering entrepreneurship, especially within marginalized communities. Financial literacy, essential for effective wealth management, is being promoted by wealth managers to help clients make informed financial decisions. Additionally, wealth managers are advocating for policy changes that promote economic equality and inclusive wealth distribution. Overall, responsible wealth management is crucial for promoting inclusive growth and prosperity globally. - Wealth Briefing

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Disclaimer:
The Financial Inclusion Forum compiles news from various sources to provide a comprehensive overview of recent developments in financial inclusion. While we strive for accuracy, the views expressed in these articles are those of the original authors and do not necessarily reflect the views of the Financial Inclusion Forum or its members. We do not assume responsibility for the content or accuracy of external websites.