H.M. Queen Máxima of the Netherlands, United Nations Secretary-General’s Special Advocate for Inclusive Finance for Development (UNSGSA), provided keynote remarks for the Sibos 2022 “Progressive Finance for a Changing World” Conference in Amsterdam on 10 October 2022.
Ladies and gentlemen, it is a great pleasure to open Sibos 2022.
Our theme – Progressive Finance for a Changing World – could not be more timely.
The rise of inclusive finance is a genuine good news story at a moment of great challenges, and I welcome your commitment to spreading its benefits more widely.
Over the last decade, a quarter of the world’s adult population has gained access to financial services. Fully 76% of adults are now in some way included.
This is a remarkable achievement, which has unlocked new opportunities for millions of people previously left behind.
Investments in critical digital public infrastructure – such as greater connectivity and digital IDs – have laid the foundations for this growth.
And the rise of digital payments has driven a massive increase in account ownership.
In the last four years, almost 40% of adults in developing economies opened their first account to receive a wage, or a government payment.
Millions of small merchants are now paid and make payments with their phones — transforming their ability to manage their finances and invest in their businesses.
This, in turn, has enabled financial service providers, especially new fintech players, to innovate in the design and delivery of new products and services.
The rapid growth in mobile phone use, and new customer data trails, offer exciting new ways to deliver financial products by leveraging big data and AI – especially in emerging markets.
Yet we should not seek innovation for innovation’s sake.
With each new technology – such as central bank digital currencies – we must always ask what problems we are trying to solve, and what future are we envisioning, to stand the best chance at achieving long-term success.
How do we provide more value beyond what existing platforms can already deliver?
The first priority is to make sure we do no harm.
Ensuring key digital public goods are in place – like cybersecurity, consumer protection, data governance, and digital literacy – can help marginalized communities navigate financial services more safely. And in ways that work for them.
Fair competition, and interoperable payment systems, can help markets work better for even the smallest-scale customers.
But that is only a first step.
We have a chance to move beyond “doing no harm”, to actually “doing good”.
So beyond transaction volumes and customer acquisition, can we create the rails for transformative change? To help users become more financially healthy? Just as we should not innovate for innovation’s sake, we should not design products simply to maximize short-term returns. Rather, it is important to see how much value we can generate in the long run. Value for customers that in turn translates into value for firms.
For example, one Australian Bank invested in measuring financial wellbeing of their customers to understand their behaviors and develop products that could help them become more financially healthy. This resulted in a goal tracker program that helped 20% of their non-savers to start saving regularly.
How can we do more of this? How can we help people to better manage their day-to-day finances, to get access to credit, to plan and meet future goals, and – at a time of multiple crises – to build resilience and insure themselves against shocks?
To do so makes good business sense. Financially healthy customers are better customers, and those who provide these services can differentiate themselves from other providers.
But for the moment, that is not what is happening.
Today, despite growth in account ownership, only 55% of adults in developing economies can access emergency money within 30 days.
Almost half of respondents in a recent survey, including those from OECD countries, agreed with the statement: “I have no money left at the end of the month”.
In some places we have seen both an increase in access to finance – and simultaneously a decrease in financial health.
So let us identify the best solutions to these challenges, and bring them to scale.
One approach is to encourage private-private partnerships, that provide services across entire value chains.
In Côte d’Ivoire, for example, I saw an excellent partnership between an agri-tech platform, Wi-Agri, a company that processes and distributes cashew nuts, and a financial services provider.
Together, they were able to combine financial services, market access, business training, and extension services, to help women across Côte d’Ivoire’s cashew nut sector. This partnership has benefited everyone across the value chain. And it has increased efficiency, transparency and productivity, supporting local economic development.
Collaboration across industry and government is also key to creating inclusive digital public infrastructure that enables services beyond finance – such as health and education. These are the building blocks of sustainable development.
If we get this right, digital innovation holds tremendous promise for financial inclusion, and financial health.
So let us envision that better future, share our experiences, and use this conference to build a secure, trusted and efficient digital economy that works for all.
Thank you so much for your time.