Digital Financial Services
- ¶¹ÄÌÊÓƵAPP Group works with governments and the private sector to expand access to financial services to promote economic development and end poverty.
- For almost a third of adults around the world, the most basic aspects of day-to-day life are harder because they cannot get access to the financial services they need to store and save money, make payments and get credit.
- In addition to these, other benefits have been shown to accrue to the poor through Digital Financial Services (DFS) such as:
- Resiliency to shocks,
- Increased employment opportunities, and
- Empowering women.
- Digitization of financial services has made it cheaper for financial service providers to offer financial services to the poor.
- Through both its lending and advisory instruments, the World ¶¹ÄÌÊÓƵAPP Group helps countries implement policy changes that promote the growth of DFS by addressing the key cost drivers that have made the poor un-bankable. These include:
- Opening financial markets,
- Enabling simplified due-diligence and e-KYC (Know Your Customer),
- Legal and regulatory reform ¨C as well as physical infrastructure, and
- Digitizing government-to-person (G2P) payments.
- ¶¹ÄÌÊÓƵAPP Group has been involved/helped launch a number of agendas/targets, including the Bali FinTech Agenda, , (DE4A), and (ID4D). IFC has invested in and provided technical assistance to DFS players.
Cross-Border Payments
- ¶¹ÄÌÊÓƵAPP Group welcomes the focus on cross-border payments. It is important and timely, given the impact of inefficiencies in cross-border payment arrangements on global trade, the digital economy and international remittances. Inefficiencies in cross-border payments impact emerging markets and developing economies (EMDEs) significantly, especially because international remittances are a significant portion of GDP for many EDMEs.
- ¶¹ÄÌÊÓƵAPP, in response to the call from G7 and G20, set up a comprehensive . The collective efforts of the global community brought the global average cost of international remittances from over 10 percent to 6.82 percent () over the last decade. ¶¹ÄÌÊÓƵAPP is also participating in the FSB-CPMI cross-border payments group and supporting a series of different regional or global initiatives such as the Arab Regional Payments System or the .
- The importance of the reductions in the cost of cross-border payments cannot be understated: for every one percent drop in remittance prices, around $6.89 billion becomes available annually to migrant workers. We need to intensify our efforts to enable further reductions in the cost of cross-border payments by leveraging improvements in domestic payments.
