The Microcredit Summit Campaign is delighted to support CFI’s efforts to track the progress of the Financial Inclusion 2020 project. In contribution to the “Financial Inclusion 2020 Progress Report,” we recently conducted a series of interviews with microfinance leaders around the world who are committed to reaching the most marginalized. Read “Addressing the financial needs of the most excluded” to hear directly from practitioners engaged in this work. Elisabeth Rhyne believes you will be both astonished by the progress and daunted by the gaps that remain” in financial inclusion. Read her post below and visit the interactive Progress Report website to take part in this financial inclusion diagnosis.
>>Authored by Elisabeth Rhyne, Managing Director, Center for Financial Inclusion
Today the Center for Financial Inclusion (CFI) is proud to launch the Financial Inclusion 2020 Progress Report, an interactive website that portrays the recent progress and unmet challenges on the path to global financial inclusion.
When we began the FI2020 project in 2011, we hoped to create a sense of both urgency and possibility. We believed that enabling everyone in the world to gain access to quality financial services was a goal of major development significance. We also saw that with many active players and the promise that digitization would enable many more people to be reached at lower cost, it was no longer simply wishful thinking to call for full inclusion within a reasonable timeframe. Global financial inclusion had entered the realm of the possible.
Today, in 2015, we are both astonished by the progress and daunted by the gaps that remain. Global Findex data shows 700 million new accounts in the three years from 2011 to 2014, reducing the number of unbanked worldwide from 2.5 to 2 billion. National governments have created ambitious financial inclusion strategies, the FinTech industry is exploding with $12 billion in global investments in 2014 alone, and the World Bank has a plan for reaching universal financial access to transaction accounts by 2020.
Our quantitative review, By the Numbers revealed that if the current trajectory of expansion in accounts continues, many countries will achieve full account access by 2020. The rails are being laid at a rapid rate, and there is great momentum toward universal access. But access to an account is not the same thing as financial inclusion, and progress toward meaningful financial inclusion, in which people actively use a full range of services, is lagging. The passengers — customers — are often still waiting at the station for services that take them where they want to go.
With assurance of great momentum around access, CFI believes that the time is right to turn greater attention to quality and value for the customer, which are the genuine heart of financial inclusion. In the Progress Report, you will find a recurring concern with the customer side of the equation. Meeting the customer challenge requires everyone — national policymakers, regulators, financial service providers of all types, non-profits, and global bodies — to step up. The challenges range from protecting consumers in the digital age, to building financial capability, to creating services that enable customers to meet important life goals.
As you read the Progress Report you will see just how many players are actively pursuing these goals in innovative ways all over the world. We cite and celebrate dozens of examples. Nevertheless, we find that in many areas, such as financial capability, the level of effort is not yet commensurate with the challenge at hand, and large shifts are called for, both in deployment of resources and in assignment of roles and responsibilities. For example, we find that meaningful financial inclusion requires providers to take on greater responsibility for customer value.
In the Progress Report, we present our assessment of progress toward global financial inclusion through the lens of five topics that will shape its future: Financial Capability, Addressing Customer Needs, Technology, Credit Reporting and Data Analytics, and Consumer Protection. The report provides a qualitative and interactive assessment of who is doing what, as a companion piece to By the Numbers
. The FI2020 Progress Report celebrates the most significant accomplishments, and highlights the gaps that create the agenda for the coming years.
Aside from the content of the Progress Report, we are excited to share with you the format for its presentation. Rather than producing a traditional document, the report takes the form of an interactive website, which allows you to move from topic to topic according to your own interest, and which allows us to bring you many specific examples and graphic illustrations in sidebars throughout the report. We hope you enjoy the format. (If you prefer a traditional PDF, that is also available.)
To provoke a conversation, we have rated progress in each area on a scale of 1 and 10, and we explain why we chose that score. We invite you to use the interactive feature on the website to cast your own vote and compare your scores to ours. Go ahead, disagree with us! While we stand behind the research and analysis that went into our ratings, they are — of course! — our own, and they reflect a global look, which may vary greatly from one region or country to another.
Most of all, consider with us the ways to close the gaps so that each of the scores rises to 10. That’s the point of this exercise, after all: to diagnose where we are today in order to work toward a future of full, meaningful financial inclusion.