Maximizing the Potential of Financial Inclusion
The world has recently faced many unprecedented shocks and stresses that have exacerbated existing development challenges—all of which have disproportionate impacts on the most vulnerable, especially women and girls. Against the backdrop of such a challenging global context, financial inclusion is an essential foundation for building a more inclusive, resilient, and green world. The advancement of digital economies and digital inclusion, as well as the increase of socially minded investments, provide hope, while innovations in digital financial services are helping redefine what inclusive financial ecosystems look like, and how they can be used as an enabler of many UN Sustainable Development Goals (SDGs) and broader development outcomes. CGAP works on many aspects of financial inclusion and on its intersection with many development challenges. Below you’ll find more information about the topics we have been working on.
Women's Financial Inclusion
Despite growing global efforts, women’s financial inclusion has made little progress over the past decade. We seek to make sense of the challenges and opportunities that pave the way to women’s financial inclusion and economic empowerment. Read more >>- Rural women face disproportionate threats from climate stresses and shocks compared to men.
- A global community of practice that aims to empower women through financial inclusion by sharing experiences, documenting emerging best practices, and solving common problems.
Micro and Small Enterprises
Millions of low-income households in emerging markets rely on micro and small enterprises (MSEs) to pursue economic opportunity and build resilience. We explore the enabling role of digital finance in strengthening MSEs as a pathway to improved livelihoods. Read more >>
Millions of low-income households in emerging markets rely on micro and small enterprises (MSEs) to pursue economic opportunity and build resilience.
MFIs play a vital role in delivering credit and other financial services to low-income customers, including closing the financing gap for micro and small enterprises (MSEs).
Building Resilience
It is vital for any development agenda, including financial inclusion, to consider how poor and vulnerable households, who will be amongst the most affected by crises and have the least strategies and tools to anticipate and cope with them, can build resilience and adapt to the crises impacting their lives. Read more >>- The world has changed dramatically in the last few years, from climate change to political unrest. What role can inclusive finance play in building resilience for people facing crises?
Climate Change
CGAP sees an increasingly urgent agenda for research and action at the crossroads of climate change and financial inclusion and is working to find and test solutions that can help poor people manage and adapt to the changing world. Read more >>
An inclusive financial system empowers vulnerable people to pursue their own climate resilience strategies, making it an absolute necessity for a just transition.- Rural women face disproportionate threats from climate stresses and shocks compared to men.
- Asset finance helps households and small businesses afford the things they need to improve their income and wellbeing - including in the face of climate change.
Digital Innovation
Digital innovation has transformed the way we live, work, and interact with each other. By leveraging digital technology such as mobile banking, digital payments, and access to credit and insurance services have made financial services accessible to individuals and businesses that were previously excluded. Read more >>
Cash-in/cash-out agent networks are key to extending digital financial services and ultimately financial inclusion. Providers have struggled to extend these agent networks in rural areas, where sparse populations lead to lower transaction volumes and weaker financial incentives for businesses to serve as agents.
While many fintechs claim to advance financial inclusion, the link between specific innovations and financial inclusion is often assumed rather than proven. The reality is that it is hard for funders, investors and social entrepreneurs know which innovations matter for low-income, underserved customers.- Across emerging markets, millions of informal workers are joining gig platforms in sectors like ride-hailing and deliveries. CGAP’s engagement with platforms, fintechs and gig workers offers a glimpse into what the future could look like.
Digital financial services providers will find here information to help them decide whether open APIs make sense for their business and, if so, how to implement an open API strategy.
With vast amounts of revenue and data at stake, merchant payments are widely seen as one of the key battlegrounds in the struggle over the future of digital financial services (DFS).
CGAP's interoperability work seeks to help low-income users transact more easily across digital financial services networks.- Emerging evidence shows that data trails generated by poor people can be harnessed for developing inclusive financial services. Learn what CGAP is doing to unlock how data can be leveraged to catalyze financial services that reach poor and underserved people at scale and in a responsible manner.
CGAP estimates that two billion low-income customers in low- and middle-income countries are digitally included, but a significant portion remain financially excluded or underserved. Open finance, with its potential to revolutionize the financial services sector, can be a substantial catalyst for financial inclusion.
Enabling and Responsible Financial Policy
Building responsible, inclusive financial systems requires a policy and regulatory environment that protects low-income customers, fosters innovation and has the flexibility to adapt in face of rapid changes brought about by digital technologies. Read more >>
Digital financial services (DFS) have become the leading driver of inclusion for the unbanked around the world, particularly in developing countries. What makes this possible is not only innovation in products and technology but regulation.
While financial solutions unlock life-changing opportunities by helping consumers save, borrow, and receive remittances, CGAP’s research shows that the nature and scale of financial consumer risks, particularly within digital finance, are evolving and growing. Is it time to reassess the existing approach to consumer protection? We think so.
Building an enabling regulatory framework is fundamental for fostering inclusive digital financial services (DFS), but it is not enough. Supervision...
Market conduct supervisors (MCSs) charged with protecting consumers of financial products and services place great value on identifying, understanding, and tracking industry developments and market-level consumer risks and consumer behavior—the activities collectively known as market monitoring.