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World Bank, others commit to accelerate access to finance

By on April 21, 2015

The World Bank Group and a broad coalition of partners – including multilateral agencies, banks, credit unions, card networks, microfinance institutions and telecommunications companies have issued numeric commitments that will help promote financial inclusion and achieve universal financial access by the year 2020.
Galvanising private-sector investment and innovation to accelerate universal financial access, including through enabling policy and regulatory frameworks, was the focus of a flagship event at the World Bank headquarters in Washington at the weekend, according to a report.
The event brought together private-sector leaders, government regulators and the UN Secretary-General Ban Ki-moon.
The 2020 goal calls for adults worldwide to have access to a transaction account or an electronic instrument to store money, send and receive payments, recognising financial access as a basic building block to managing an individual’s financial life.
Access to a transaction account is a first step toward broader financial inclusion, which helps poor families escape poverty and afford essential social services such as water, electricity, housing, education and health care. For small firms and medium-sized enterprises access to financing can help them reduce risks, grow and expand operations.
“More than 700 million people gained financial access between 2011 and 2014, and this gives us fresh evidence that our ambitious goal of universal access by 2020 is attainable,” said World Bank Group President Jim Yong Kim.
“The World Bank Group’s role is to convene and energize a coalition of partners — and also to step up our work. Over the next five years, our institution commits to enabling as many as 1 billion adults, who are now financially excluded, to gain access to a transaction account.”
The World Bank Group’s commitment builds on and scales up support to governments to create an enabling environment for private-sector innovation and investment. Priority actions include reforms to eliminate or reduce cost or distance barriers to opening and using accounts, measures that increase the viability of new technology and business models to reach the financially excluded. The Bank Group’s private-sector arm, IFC, is also boosting its engagement with the private sector to add millions of new account holders through its investment and advisory work with financial intermediaries and other partners.
Private-sector leaders from around the world came forward with a committed set of actions to reach a specific number of people by year 2020.
“Today, MasterCard is proud to announce our commitment to the World Bank Group’s efforts toward universal financial access. Our target is to reach 500 million people currently considered to be excluded from the financial mainstream. In making this commitment, we recognize that reaching full financial inclusion by 2020 requires the active engagement and commitment of the private sector, working in partnership with governments and international development organizations,” the chief executive officer and President of MasterCard, Ajay Banga said.
“Together, we can be agents of transformative change who create more inclusive economies and more empowered populations.”
Several leaders of emerging markets companies also made concrete commitments today to reaching the goal.