UNSGSA Queen Máxima delivered virtual opening remarks at the G20 Global Partnership for Financial Inclusion (GPFI) High-Level Symposium on 4 October 2021. The UNSGSA is Honorary Patron of the G20 Global Partnership for Financial Inclusion (GPFI). The event was held under the theme of coping with new and old vulnerabilities in a post-pandemic world.
Governor Visco, GPFI Co-Chairs, Ladies and Gentlemen,
It is a pleasure to join you virtually today. I’m delighted to see that some of you are able to be in Rome to reconnect and renew bonds in person, finally.
Today I would like to tell you about Izu Hassan.
I met Izu in 2019 during a visit to Bangladesh. Three years before, she started to produce hair oil to sell to neighbors and friends. This hair oil was based on her grandmother’s recipe. It was an instant hit. However, to commercialize her home-based informal micro-business, she needed support. So, she turned to a local fintech called ShopUp.
Via ShopUp’s app, Izu could quickly access credit, based on her digital transactions. The company also supported her with back office and online administration. Furthermore, ShopUp helped Izu build digital and financial literacy skills with in-person and virtual training. Today, Izu has a booming business with four employees and bought a house for her parents.
Now, Izu’s story shows how inclusive technology-led innovations can present our best pathway to go beyond digital payments to other invaluable services, such as credit, savings and insurance. When offered responsibly, these solutions can create new opportunities, build financial health, empower the excluded, and support an inclusive recovery.
Izu is not alone. Over the last year, ShopUp saw double-digit growth in revenue. To assist the growing number of MSMEs in its digital ecosystem, ShopUp has partnered with Bangladesh’s largest manufacturers, producers, and distributors to help smaller enterprises get access to better terms. And, in Septermber, the company raised the largest financing round ever for a fintech in Bangladesh. They hope to use this funding to provide tailored digital opportunities to the 4.5 million mom-and-pop stores across the country — the vast majority of which have no digital presence.
This is merely a single example of one fintech and small enterprise, but it highlights the unique opportunity upon us. Not only in emerging markets, but in advanced ones, too. We can capitalize on innovation, not for innovation’s sake, but to enable transformative opportunities that improve people’s lives and lead to positive development outcomes. Digitization to support key sectors is crucial for building broad-based growth and development, including MSMEs and smallholder farmers.
This is especially needed today.
Although global economic activity continues to improve, it is evident that recovery from the COVID-19 crisis has been uneven. While incomes in most advanced economies are forecast to return near pre-pandemic levels next year, only one-third of low-and-middle income countries are expected to make similar recoveries.
The groups hurt the most by the pandemic have been the underserved — including women, informal workers, smallholder farmers, and small businesses. Already with limited access to the digital economy and financial services prior to the crisis, they have disproportionately felt its lingering economic impacts.
Countries that previously invested in digital public goods witnessed their worth when the pandemic hit. This includes foundational ID systems, connectivity, interoperable payments infrastructure, consumer protection policies, and digital and financial literacy. These key prerequisites enabled the rapid rollout of social transfers, digital financial services, and supported a shift to online payments for goods and services.
Yet, challenges need to be addressed. Digital risks from fraud, cybercrime and identify theft need to be mitigated. We should be vigilant that increased digitization does not exacerbate the digital divide and other inequalities, but instead addresses them. Digital financial literacy, as well as policies that protect MSMEs and consumers, will be key components to this.
I warmly welcome the work of the GPFI this year in developing a menu of policy options to help set a course towards a new, more digital, and more inclusive “financial normal”. One that addresses the digital risks to consumers and small businesses. COVID-19 has reinforced the urgency of these policies.
I hope governments, businesses, and development champions will use this valuable resource. It will help as we refocus our efforts to improve digital financial capabilities and protections for consumers and small businesses. Doing so will enable entrepreneurs like Izu to more effectively and safely grow their businesses and thrive in the future.
Furthermore, as the Honorary Patron of the G20 GPFI, I congratulate the Italian G20 Presidency and the GPFI, under its co-chairs, for organizing this week’s plenary sessions, as well as the high quality of your work.
I look forward to following your countries’ continued progress and cheering your accomplishments. Together we can drive action to help us recover and build a more inclusive, resilient and responsible digital financial system, with expanded opportunities for all.
Thank you very much and good luck.