Research & Analysis

Can Inclusive Carbon Markets Pave the Way for a Just Transition?

Green technologies—like solar panels and clean cookstoves—have the potential to transform lives and protect the planet but remain out of reach for many in developing economies. Voluntary carbon markets (VCMs), where companies purchase carbon credits to offset greenhouse gas emissions, hold immense promise in enabling the adoption of green technologies among households on the frontlines of climate change. But how do VCMs work, and how can financial services support more inclusive carbon markets?

Innovative Financing for Inclusive Credit Fintechs in Africa

Inclusive credit fintech can help address the US$4.9 trillion global credit gap for MSEs. However, early-stage fintechs face significant challenges in securing diverse funding sources. This focus note explores financing strategies for inclusive credit fintech in Africa, highlighting recent innovations and case studies. It also identifies knowledge gaps that hinder strategy design for international donors and impact investors eager to support digital innovations in MSE credit markets.

Exclusion Risks in Climate-Related Financial Regulation: An Analytical Framework

This working paper presents an analytical framework to identify the potential exclusionary effect of climate-related financial sector regulation on the incentives and ability of financial service providers to lend to vulnerable segments in emerging markets and developing economies. The analysis is backed by evidence gathered from three countries: Bangladesh, Brazil, and Colombia.

Can AI Revolutionize Financial Consumer Protection?

AI is already transforming almost every aspect of the financial services industry. It is driving efficiencies and sparking innovation by reshaping the way financial authorities protect consumers—not just how financial service providers operate. But financial authorities need to walk a tightrope to harness the power of AI to improve consumer protection, while also addressing the novel risks and challenges that AI brings, such as new forms of financial fraud.

G20 Policy Options for Financial Inclusion at the Last Mile

Despite gains in financial inclusion, several populations at the "last mile" remain excluded. This Note, prepared by CGAP, the World Bank, and the Better than Cash Alliance for GPFI, provides a framework for the necessary public infrastructure and regulatory enablers to reduce the barriers commonly faced by these last mile segments and emphasizes the need for more targeted policies and investments to address non-financial barriers.

Banking on Open Finance to Advance Financial Inclusion: Lessons from Brazil 

Open Finance allows people in Brazil to securely share their financial data across financial service providers, sparking competition and innovation among providers. This empowers customers to compare and choose services that best meet their needs. But how does open finance work in practice and can it help reduce inequality and advance financial inclusion? What lessons can other countries learn from Brazil’s rapid adoption?

Empowering Micro-Retailers Through Digitization: Hype or Promise?

Micro-retailers that stock fast-moving consumer goods are universally cherished. And yet, they face numerous unique challenges. B2B e-commerce startups are promising to make a difference for these micro-retailers by digitizing order processes and extending buy-now-pay-later credit options. But challenges remain: How do we bridge the digital divide, and can these systems sustainably scale? How promising is this digitization wave in creating meaningful financial inclusion for micro retailers at the last mile?

Voices From the Frontlines of Climate Change

For those on the front lines, grappling with climate change is a daily struggle for survival. In this episode, we travel to Bangladesh to speak with two farmers who are fighting to protect their homes and livelihoods from storms, flooding, and rising sea levels. We also hear from MicroSave Consulting and CGAP about the potential role financial tools can play in bringing hope, resilience, and lasting change to climate-vulnerable communities.

Key Considerations for Open Finance

Open finance frameworks have the potential to increase innovation, boost competition, empower customers, and deepen financial inclusion. However, they also introduce new risks that necessitate careful design and robust safeguards. As more countries explore or implement these frameworks, CGAP, BIS, IMF, UNSGSA, and the World Bank offer key considerations for designing effective and inclusive open finance frameworks.

Trust in Transition: Afghanistan’s Hawala System in Crisis and Recovery

Afghanistan’s hawala system plays a critical and evolving role in the country’s financial ecosystem. Since August 2021 its role has only expanded as trust in the banking system faltered. Although hawala faces local competition and international skepticism due to transparency concerns, it remains a vital financial tool. The paper suggests that stakeholders should deepen engagement with hawala networks, support their regulation and formalization, and explore innovative partnerships to advance financial inclusion.