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STORY: WORLD BANK/ FINANCIAL INCLUSION
TRT: 1.36
SOURCE: WORLD BANK
RESTRICTIONS: NONE
LANGUAGE: ENGLISH / NATS
DATELINE: 12 NOVEMBER 2013, WASHINGTON, DC / FILE
RECENT - WASHINGTON, DC
1. Wide shot, exterior World Bank Headquarters
12 NOVEMBER 2013, WASHINGTON, DC
2. SOUNDBITE (English) Asli Demirguc-Kunt, Director of Research, Development Economics World Bank Group:
“The World Bank’s Financial Inclusion Report shows that financial inclusion is crucial for reducing poverty and boosting shared prosperity. It’s interesting that half the working age population of the world does not have a bank account, that’s about two and a half billion people. “
FILE – 2013 SOUTH AFRICA
3. Standard Bank tent zoom out to people
FILE – 20132, RWANDA
4. Med shot, office and workers at cubicles
12 NOVEMBER 2013, WASHINGTON, DC
5. SOUNDBITE (English) Asli Demirguc-Kunt, Director of Research, Development Economics World Bank Group:
“The report shows that most people, and particularly the poor, can benefit from using basic savings, payments and insurance services.”
FILE – 2013, BRAZIL
6. Med shot, people sit in rows of chairs
7. Med shot, two women study paper
8. Med shot, woman walks up to bank door
12 NOVEMBER 2013, WASHINGTON, DC
9. SOUNDBITE (English) Asli Demirguc-Kunt, Director of Research, Development Economics World Bank Group:
“In order to expand inclusion its important to focus on government and market failures, providing an enabling environment of good regulation and laws, healthy competition for financial service providers and good information allows them to embrace technologies that would expand inclusion such as mobile banking also innovate interesting products such as commitment savings or index insurance.”
FILE – 2013, BANGLADESH
10. Med shot, people haul bags on heads to truck
11. Med shot, people carrying bricks on shoulders
FILE – 2010, MOROCCO
12. Med shot, men in crowded marketplace
FILE – 2013, BANGLADESH
13. Med shot, men stand around desk with papers
14. Close up, papers, calculator, and hands
As mobile banking and other technological innovations fuel the expansion of financial services in many developing countries, a new World Bank Group report urges policy makers to focus on products that benefit the poor, women and other vulnerable groups the most.
No-frills savings and payment accounts, for example, offer a safe place for people to store and transfer money and help them maintain a relatively stable living standard. Evidence, however, is mixed on microcredit and micro-insurance products.
SOUNDBITE (English) Asli Demirguc-Kunt, Director of Research, Development Economics World Bank Group:
“The World Bank’s Financial Inclusion Report shows that financial inclusion is crucial for reducing poverty and boosting shared prosperity. It’s interesting that half the working age population of the world does not have a bank account, that’s about two and a half billion people. “
The 2014 Global Financial Development Report: Financial Inclusion, is the most comprehensive report yet on the topic. It comes as policy makers are pushing to reach the world’s unbanked – 2.5 billion people who make up about half of the world’s adult population. More than 50 countries recently set targets to improve financial inclusion. Last month, World Bank Group President Jim Yong Kim announced a new initiative to provide universal financial access to all working-age adults by 2020 – with the help of technological innovations such as e-money accounts and e-mobile wallets.
SOUNDBITE (English) Asli Demirguc-Kunt, Director of Research, Development Economics World Bank Group:
“The report shows that most people, and particularly the poor, can benefit from using basic savings, payments and insurance services.”
Mobile banking has played a key role in expanding financial inclusion among low-income populations in countries such as Kenya, the Philippines and Tanzania. Brazil increased financial access to people living in remote areas by promoting technology-based “correspondent banking” – financial services provided on behalf of banks by retails stores, gas stations, and agents on motorcycles and boats on the Amazon River.
SOUNDBITE (English) Asli Demirguc-Kunt, Director of Research, Development Economics World Bank Group:
“In order to expand inclusion its important to focus on government and market failures, providing an enabling environment of good regulation and laws, healthy competition for financial service providers and good information allows them to embrace technologies that would expand inclusion such as mobile banking also innovate interesting products such as commitment savings or index insurance.”
The poor benefit the most from technological innovations, which make financial services cheaper and easier to access, the report says. Low-income economies, especially those with remote, sparsely populated areas, have much to gain from allowing the provision of financial services outside of established bank branches.
Many countries have made progress in expanding account use among the poor, women, youth, and rural residents, even without tapping into advanced technology. Some policies have proven to be especially effective, such as requiring banks to offer low-fee accounts, waiving onerous documentation requirements and using electronic payments to deposit government assistance into bank accounts. South Africa, with a public-private framework, increased the number of bank accounts by six million in four years. Brazil’s regulatory reforms led to a dramatic expansion of places offering financial services – now in every municipality in the country.
To promote financial inclusion responsibly, the report urges policy makers to improve the standards for information disclosure and support innovative, well-designed financial products that address market failures, meet consumer needs and overcome some behavioral hurdles. For example, commitment savings accounts, where access to cash is possible only after a period of time or after a goal has been reached, can promote savings. And if well designed, index-based insurance, which links payouts to a well-defined index, such as the amount of rainfall or commodity prices, reduces moral-hazard problems, because payouts reflect a measurable index beyond the control of the policyholder.
