FINANCIAL INCLUSION SUPPORT FRAMEWORK

CONTEXT, OBJECTIVE

The objective of the Financial Inclusion Support Framework (FISF) is to accelerate and increase

the effectiveness of reforms and other country-led actions that help achieve national financial

inclusion targets and strategies. At least 50 countries have set financial inclusion targets and/or

made headline commitments to actions to improve financial inclusion (typically for bank

accounts, micro/SME finance, mobile payments, and/or financial literacy).

FISF supports policy and regulatory reforms, financial infrastructure development, and other

measures that catalyze private sector financing, knowhow and innovation, and that result in a

broad range of financial services – including payments, savings, insurance, credit - being used

by low income households and MSMEs that are currently un-banked or under-banked.

By enabling regulators, governments, and other stakeholders to implement evidence-based

reforms, as well as transformative initiatives with the private sector and civil society, significant

increases in financial inclusion can be achieved. FISF-supported reforms can catalyze increased

private sector innovation and investment, expanding and improving financial inclusion.

There are 3 components to FISF, with an initial focus on Country Support Programs (CSPs).

Financial Inclusion Support Framework: Components

FISF was welcomed by the G20 Finance Ministers, the Alliance for Financial Inclusion, and by

partner agencies, and was designed in coordination with IFC and CGAP. FISF has initial funding

of $25m from the Netherlands Ministry of Foreign Affairs, and further funding in final stages of

approval from the Bill & Melinda Gates Foundation.

Country Support Programs

Technical assistance and capacity

building programs for up to 20

countries. First programs are in

Indonesia, Mozambique, Rwanda

Financial Inclusion Challenge

Research and Models

Agricultural finance, women and

finance, impact and cost

effectiveness of FI reforms

Results-based financing to

accelerate financial sector

response to FI reforms.

COMPONENT 1: COUNTRY SUPPORT PROGRAMS

Within the last 10 months over 15 countries have requested the World Bank Group’s assistance

in developing and/or implementing financial inclusion strategies and action plans, and more

requests are being received. FISF scales up and leverages the World Bank Group’s policy

dialogue, analytical work, and financing for financial inclusion in over 60 countries.

Preparation of FISF country support programs is underway in a first set of countries

(Mozambique, Rwanda, Indonesia), with a second set of FISF countries in the process of being

identified. A broader set of countries can also be assisted through the second FISF component

– the Financial Inclusion Challenge – as well as through FIRST Initiative funding.

Priority areas for technical assistance and advisory inputs for the initial set of 3 countries

include the following:

Digital financial inclusion and payments (including government to person payments)

Regulation and supervision of microfinance/non-bank financial institutions

SME finance, including credit ratings, credit guarantee schemes, innovation finance

Agricultural finance, including supply chain finance

Responsible finance: financial consumer protection, financial literacy/education

Financial inclusion indicators and targets, national coordination structures

COMPONENT 2: FINANCIAL INCLUSION CHALLENGE

A competitive results-based financing mechanism will be designed, in order to accelerate the

response of the financial sector in taking advantage of financial inclusion reforms and meeting

targets, including through disruptive and innovative approaches. Subsidies would be allocated

competitively based on results achieved in terms of extending or improving access to financial

services (for example number of persons reached, number of transactions per person, or level

of infrastructure investment).

COMPONENT 3: KNOWLEDGE

FISF will generate analysis and share models relevant to designing and implementing effective

financial inclusion reforms, in order to further catalyze progress towards financial inclusion.

Workshops will be held on the topics of agricultural finance, and women and finance, to shape a

research/analytical work program for each. A further topic being considered is the relative impact and

cost effectiveness of financial inclusion measures and reforms.