Op-ed by Eloise Duncan, CEO and Founder, Financial Resilience Institute

Financial health and financial resilience innovation is a global priority, and we’re seeing momentum.

Celebrating 15 years of a remarkable milestone in financial inclusion advocacy by H.M. Queen Máxima, the @United Nations General Assembly brought together leaders from the UN, public and private sectors and international organizations to highlight the best practices that have advanced the financial inclusion agenda globally and explore forward-looking priorities on September 25, 2024. UNSGSA H.M. Queen Máxima declared her office’s revised appointment from financial inclusion to financial health: an important development. Her Majesty’s now serves as the United Nations Secretary-General’s Special Advocate for Financial Health. The UNSGSA defines financial health as the extent to which a person or family can effectively manage daily expenses, withstand financial shocks, achieve their financial goals, and gain confidence in their financial lives. [1]

Many inspirational global leaders spoke around why financial health matters for our world, businesses, people and economies. These included World Bank’s Ajay Banga, Peter Jacobs, CEO of 荷兰国际集团 , James Mwangi, CEO of Equity Bank Limited , Jennifer Teschler Founder and CEO of Financial Health Network, Mastercard's Michael Miebach, Bill & Melinda Gates Foundation’s Bill Gates and others. Access the recording here: https://webtv.un.org/en/asset/k1q/k1qkn3fquq

The UNSGSA also launched a call to action during the event to address the remaining unbanked, with many partners now committed to reduce the 1.5 billion people that are financially excluded by half by 2030 and by two-thirds by 2035. Furthermore, 100% of all those new accounts need to be active, meaning that account owners made at least one deposit, withdrawal, or digital payment in the past year. In addition, there will now be an increased collective and strategic focus on improving financial health and financial resilience by the global ecosystem. This has the power to transform lives, economies and communities, especially in light of climate change and many other global challenges.

Takeaways and key themes:

1. As we see a heightened focus on fostering financial health and financial well-being for all, it is critical that more individuals, families and businesses have access to high-quality, affordable financial products and more inclusive financial systems that puts people at the center. There is a particular need to foster equity and inclusion and for policymakers, financial institutions and others provide more targeted support and interventions to help lift up women, young people, people facing systemic barriers, small businesses, farmers and those who are more financially vulnerable. This will be key as people seek to manage their daily financial management, save plan and invest for the future, protect against the unexpected and access and manage credit, all while being able to bounce back from unplanned life events, stressors and shocks. It will also be key to help foster small business financial health and resilience. A financial health perspective extends far beyond financial inclusion, which primarily focuses on providing basic access and usage of financial products. Instead, it emphasizes ensuring that individuals benefit from a broader range of financial products, such as savings and insurance, that contribute to building resilience and long-term prosperity.
2. Mr. Achim Steiner, UNDP Administrator, confirmed financial health as a critical pillar to eradicate poverty, reduce inequalities and advance all 17 of the United Nation’s Sustainable Development Goals (SDGs). Peter Jacobs, CEO of ING Netherlands, highlighted that financial health impact is a pre-requisite to driving positive change in societies. Financial Institutions – also as employers – can drive measurable benefits for its business as well as its customers and communities by focusing on financial health. Improving the financial health and lives of customers creates win-win benefits for financial institutions, customers and businesses alike. In other words, this is not philanthropy. It is about leading with purpose.
3. Many organizations and leaders will individually and collectively take the lead in advance financial health impact as a catalyst for positive change. ?Cross-sector collaboration and partnerships are critical as this is about systems change. Many stakeholders have a role to play, and this is journey. Policymakers, regulators, financial institutions, private and public sectors, fintechs, NGOs, employers and purpose-driven leaders can collectively and individually work to make a difference. While over 60 countries now have national financial inclusion strategies in place, there are significant opportunities for more countries to come on board and join the financial health movement. Large organizations can take a more active role in directing resources toward the UN’s SDGs while generating and measuring business, customer and social impact outcomes.
4. In the words of the Officer of the Comptroller of the Currency’s (OCC) Michael J. Hsu, ‘what gets measured gets managed’. He and others confirmed that data, research and impact measurement are critical to help identify opportunities to deepen financial health. Acting Comptroller Hsu presented the OCC’s vital signs project , which is an initiative aimed at monitoring and assessing the health and stability of the financial system, particularly banks and other financial institutions under its regulation.
5. There are significant opportunities for financial health and financial resilience innovation and impact in developed and developing countries alike. This will be a journey, and requires collective and individual leadership, courage and action. Leveraging data-driven insights, technology, OPEN banking, AI, product, service and program innovation, advocacy and more, ecosystem players can advance measurable positive financial health, resilience and well-being outcomes for individuals, small businesses and communities. Continued leadership and advocacy by UNSGSA H.M. Queen Máxima and others will be powerful as we work to catalyze more resilient, sustainable communities.

Thank you UNSGSA H.M. Queen Máxima, for your unwavering efforts as a leading global voice advancing financial inclusion and financial health for those who need it most.

Financial Resilience Institute is excited to see the growing momentum in the global financial health movement. We look forward to playing our part, learning from others and leaning into opportunities to drive positive change. A collective team effort is essential to help improve the financial health and financial resilience for all people, small businesses and economies. We’re excited for the future and committed to playing our part in our global, interconnected world.

#financialinclusion #financialhealth #financialresilience

[1] Source: https://www.unsgsa.org/publications/financial-health-introduction-financial-sector-policymakers