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CGD and IMF Join Forces to Discuss Financial Inclusion

Does broadening financial access to large segments of the population pose risks to financial stability? Not necessarily, according to recent remarks by IMF managing director Christine Lagarde. Increasing access to basic financial transactions such as payments does not threaten financial stability, especially when appropriate supervisory and regulatory frameworks are in place. In fact, with the right regulatory supervision, increased access to financial services can result in both micro and macro benefits. Recognizing the macroeconomic and regulatory dimensions of financial inclusion, CGD and the IMF joined forces for a seminar to kick off the IMF Spring Meetings 2016.

Gender and Financial Inclusion: With a Nudge and a Twist

At a CGD event on financial inclusion, IMF Managing Director Christine Lagarde noted that financial inclusion is a priority for the post-2015 development agenda as a whole. Here we explore both the benefits of financial inclusion and some concrete steps for achieving it,  specifically looking at ways to overcome a persistent gender gap that leaves women with less access to financial services than men. 

Better Regulation Can Improve Financial Inclusion

Poor regulation is a key obstacle to financial inclusion. An enabling regulatory environment is critical for creating incentives for businesses to offer innovative financial services to the poor, and for underserved customers to take up formal financial services.

San Isidro Dispatch: Village Banking in Costa Rica

I spoke last month at the annual Inter-American Forum on Microfinance (Foromic), which is sponsored by an arm of the Inter-American Development Bank called the Multilateral Investment Fund. (The MIF invests in the private sector while its parent lends to governments.) The conference took place outside San José, Costa Rica, in a resort off the highway to the airport.

Financial Access Studies Clash over Whether Glass is Half Full or Half Empty

The biggest controversy to hit microfinance since the Compartamos IPO erupted this week as easygoing, bookish economist types at two East Coast microfinance research institutions dueled over the longstanding empirical question of whether the glass is half full or half empty. CGAP researchers, citing industry-consensus best-practice guidelines, accentuated the positive in observing that about 2.5 billion adults worldwide have accounts with formal banking institutions (about 2.5 billion do not). Academic researchers at the NYU-based Financial Access Initiative adopted a more skeptical stance, pointing out that Half the World is Unbanked.

OK, so I won't quit my day job for nightclub comedy.

Two new studies are indeed out tallying how many people have credit or savings accounts with commercial banks, savings banks, post office savings banks, cooperatives, government development banks, and microfinance institutions. The FAI report is short and sweet and draws on data from Patrick Honahan, who is now governor of Ireland's central bank. In contrast, the CGAP report harvests new information collected by surveying financial regulators in 139 countries.