Clark: UN Inter-Agency Meeting on Inclusive Finance for Development

22 Mar 2011

Comments of the UNDP Administrator and UNDG Chair, Helen Clark
On the occasion of the UN Inter-Agency Meeting on Inclusive Finance for Development
22 March 2011

Helen Clark and Princess Máxima of the Netherlands
meet at UNDP headquarters in New York
(Photo: UNDP)

I thank all present for their attendance. The turnout of so many organisations is evidence in-itself of the importance of financial inclusion to the UN’s development work.

I thank Her Royal Highness Princess Máxima for the initiative which has brought us together this morning, and for her tireless efforts to advance financial inclusion around the world. Princess Máxima’s advocacy has won the attention of G20 members and the support of countless development partners.

Princess Máxima has used the following definition of financial inclusion: “It is about achieving universal access to a wide range of financial services at reasonable cost and through a variety of sound and sustainable institutions.”

Appropriate financial services can enable employment-generating businesses to grow, and families to bridge tough times and strengthen livelihoods. Expanding access to financial products can also bring people and businesses into formal financial systems – making their assets available, in turn, for productive investments.
In both ways, financial inclusion can enable inclusive growth – and thus help countries accelerate progress toward the MDGs.

The financial inclusion activities your agencies shared ahead of this meeting reveal a striking range and diversity. Whether its assistance for cash transfers for families, the cash for work or cash for food programmes; humanitarian responses; studies on microfinance, or legal and regulatory support for microfinance institutions –all can help expand and improve the financial services available to the poor – whether or not it is their principal objective.

Your activities, both planned and undertaken, demonstrate promising innovation. UNCDF, for example, is proposing a clean start programme which uses carbon credits to help LDCs close the financing gap for cleaner sources of energy. UNDP and UNCDF were able to pilot “branchless” banking with some of the largest mobile phone operators in the Pacific – cutting the cost of financial services for dispersed populations.

Your activities also demonstrate significant collaboration. The ILO and UNCDF, for example, are working together to offer micro-insurance products to help the poor manage risk; and IFAD and UNCDF are collaborating to increase the services that help the rural poor make the most of remittances. We also see interagency co-operation on the Growing Inclusive Markets initiative and through the Business Call to Action, which, in partnership with Barclays, is launching a programme to expand financial services to approximately 60,000 persons in four African countries.

I hope this meeting can help us make connections between our respective efforts to improve our joint effectiveness.

I now hand the floor to Her Royal Highness, and invite her to tell us more about her work and the many opportunities increased collaboration would present to advance financial inclusion for development.

Helen Clark on Meeting Objectives

I thank Princess Máxima for her presentation. She offers us much to take forward during the course of this meeting.

The meeting’s objectives are clear. By the end, we hope participants will have arrived at:

  1. a shared understanding of how a common UN agenda on financial inclusion can advance our respective mandates, and
  2. a commitment to mutual exchange and in-country and global collaboration through established mechanisms.

Across our respective mandates, there are synergies which point to common priorities. Your agencies have shared a number of such ideas ahead of this meeting. They can be distilled into three overarching suggestions:

  1. The UN can multiply the impact of its efforts by twinning financial services with programmes designed to help people meet basic needs. For example, the UN can help partners design cash transfer programmes linked to opportunities for saving.
  2. Second, the UN can more consistently apply what it knows about financial inclusion. We need to ensure that sound and proven practices are followed across all agencies and programmes. That means we need to learn from each other, follow common good practice guidelines, and put an end to unsound or un-sustainable approaches.
  3. A third idea is to identify strategic areas where financial inclusion objectives can be systematically integrated. We know for example that integrating financial services in emergency plans can help make responses faster, better, and more cost effective.

    Insurance schemes and financial services backed by carbon finance also offer the potential to help countries expand energy access, while adapting to and mitigating climate change.

    Electronic transfer systems can cut the costs of social protection programmes by directly crediting beneficiaries’ savings accounts - helping them to build a financial cushion or buffer.

The issue before us is not simply what each agency is doing on financial inclusion, but how financial services and inclusive financial systems can accelerate development.

This meeting is necessarily a first step towards arriving at a shared UN agenda for inclusive finance. We need to continue this dialogue both here at headquarters, and in the field, ensuring that the right connections are made in country programming and diagnostics.

I will now leave you to discuss the best way forward, but will return, before the meeting closes to hear your conclusions.