The UFA2020 envisions that adults worldwide -- women and men alike -- will be able to have access to a transaction account or an electronic instrument to store money, send payments and receive deposits as a basic building block to manage their financial lives.
At the 2015 World Bank Group-IMF Spring Meetings, the World Bank Group and public and private sector partners issued numeric commitments to achieve Universal Financial Access by 2020 (UFA2020) and help promote financial inclusion. The vision for universal financial access was first announced by the World Bank Group President Jim Yong Kim at the 2013 World Bank Group-IMF Annual Meetings.
Through the Universal Financial Access 2020 initiative, the World Bank Group – the World Bank and IFC – has committed to enabling 1 billion people to gain access to a transaction account through targeted interventions.
The World Bank has set a target to help enable 400 million adults to be reached through knowledge, technical and financial support, while IFC has set a target to help enable 600 million adults to be reached through investment and advisory services.
As of the end of December 2016, our advisory, technical assistance, and financing operations are projected to help reach 656 million new accountholders by 2020 (toward our 1 billion goal).
Cornerstone IFC UFA projects in 2016 included investments in innovative projects such as:
Ant Financial, the financial services subsidiary of Alibaba, China, in asset-backed securitization in the capital markets to grow their lending to MSMEs, and provide access to 1.75 million new accounts.
MasterCard settlement risk-sharing facility to create greater financial access and provide access to more than 5 million new accounts globally.
LAPO Microfinance Bank to fund expansion of Nigeria’s largest MFI, adding over 1 million new accounts.
Bandhan where IFC invested over $90 million and supported its transformation to a universal bank, to provide access to 38 million accounts
Other investments include in Postal Savings Bank China where IFC made a $286 million equity investment; FINO which is the largest digital payments provider in India, and bKash to develop a merchant payment system in Bangladesh.
We also work with partners to catalyze private sector investment in financial inclusion. Leading financial service providers have set ambitious targets in line with the UFA 2020 goal. The 32 UFA financial sector partners with concrete commitments include banks (Equity Bank, Bank Mandiri, LAPO Microfinance Bank, State Bank of India), credit unions and savings banks (Confederation of West African Financial Institutions, WOCCU, WSBI), card networks (Visa and MasterCard), microfinance institutions and alliances (Aga Khan Agency for Microfinance, Asomicrofinanzas, Asomif Peru, Bandhan, BBVA Microfinance Foundation, CFPA Microfinance, Gentera, Global Banking Alliance for Women, Grameen Foundation, Grooming Centre, LAPO Microfinance Bank, Microfinance CEO Working Group, Microcredit Summit Campaign, Mibanco, NMB Bank Plc of Tanzania, Pakistan Microfinance Network, Pakistan Microfinance Investment Company), telecoms companies (Telenor, Ooredoo), fintech (Ant Financial, Baidu Financial Services Group, Pagos Digitales Peruanos), financial institutions (Fullerton Financial Holdings), and trade associations (the GSMA).
While the UFA2020 initiative focuses on 25 priority countries where 73% of all financially excluded people live, we are working with more than 100 countries to advance financial access and inclusion. India and China have the largest share of unbanked people and together they account for some 32% of them. The rest of the focus countries include: Bangladesh, Brazil, Colombia, Cote d'Ivoire, DRC, Egypt, Ethiopia, Indonesia, Kenya, Mexico, Morocco, Mozambique, Myanmar, Nigeria, Pakistan, Peru, Philippines, Rwanda, South Africa, Vietnam, Tanzania, Turkey, and Zambia.
Our approach centers on:
- introducing transaction accounts,
- expanding access points,
- improving financial literacy, and
- driving scale and viability through high-volume government programs, such as social transfers, into those transaction accounts.
We also work with countries to strengthen the following key building blocks: public and private sector commitment, enabling legal and regulatory framework, and bolstering financial and ICT infrastructure.
Globally, we engage with standard-setting bodies to set recommendations and guidelines that will to advance access to transaction accounts:
In 2015 a financial regulator taskforce chaired by the World Bank Group and the Committee on Payments and Market Infrastructures (CPMI) issued the Payment Aspects of Financial Inclusion (PAFI) report, which identified needed improvements in payment systems and services to increase financial inclusion. The report outlines seven guiding principles and provides guidance to regulators and policymakers on actions countries can take to advance access to transaction accounts.
In 2017, the G20 committed to advance financial inclusion worldwide and reaffirmed its commitment to implement the G20 High-Level Principles for Digital Financial Inclusion, which the World Bank Group helped develop under the China G20 Presidency leadership in 2016. The eight High Level Principles encourage governments to promote a digital approach to financial inclusion, and are being used as a reference tool by many countries.