African Policymakers shine the spotlight on
Yaoundé, Cameroon, March, 18 2008 -
Amid a frenzy of policy activity around microfinance, the Central Africa Policy Forum begins today in Yaoundé. Over the course of two and a half days, regional leaders from ten countries in Sub-Saharan Africa will discuss how policy measures can be used to improve access to financial services for low income people in the region.
Covering issues such as the regulation and supervision of cooperatives, how to reduce the costs of financial services, options for new banking technologies to reach unbanked people, and how to ensure that poor people’s money is protected while offering increased access to services, the forum brings together decision-makers across the region to share experience on the evolving opportunities for expanding access to microfinance through effective policies.
Microfinance has received considerable attention in recent years, particularly since Professor Muhammed Yunus and the Grameen Bank were awarded the 2006 Nobel Peace Prize, raising awareness of the role that financial services play in helping poor families manage their precarious lives. But access to formal financial services is still severely limited in Africa. “With just one in five households having access to formal financial services, Sub-Saharan Africa suffers from one of the lowest rates of access in the world” said Jennifer Isern, who leads CGAP’s work in Africa. “But there are huge opportunities. With the right policy direction, Africa is poised for massive expansion in financial services, building on robust economic growth, donor commitment, a strong savings culture, and a very diverse landscape of providers.” Innovations such as the use of mobile phones and other new technologies for the delivery of financial services offer great promise for reducing transaction costs, and therefore potentially making these services available to millions more poor people, including those living in Africa.
Policymakers will have a critical influence in shaping the future of access to finance on the continent, says Isern: “Financial institutions need a policy environment that encourages competition and creative new services under transparent conditions. Above all, services must be viable financially and operationally. But policymakers must also take into account the impact on poor people and ensure that they are protected.”
The need for greater transparency around pricing of services and consumer education are all hot-button issues for decision-makers in Africa today. These will form part of the exchange as policymakers gather in Yaoundé over the next three days to consider future opportunities for the continent and offer their support to microfinance in the region.
The Central Africa Policy Forum is organized by CGAP, a microfinance industry body housed at the World Bank, in partnership with the BEAC/COBAC, the EU, MAE/France, AFD, FIRST Initiative, the UN Advisors Group on inclusive financial sectors, and Making Finance Work for Africa(MFW4A).