Officials, businesses and development partners at the National Financial Inclusion Forum in the capital yesterday focused on the progress and challenges on financial inclusion in Myanmar and reviewed an update of the Making Access to Financial Services Possible project. The project measures the level of exclusion of the country’s financial sector.

The event was organised by the Financial Regulatory Department and supported by United Nations Capital Development Fund (UNCDF) and the UK-funded DaNa Facility.

Officials and development partners highlighted the importance of financial inclusion in developing an economy which works for everyone.

Deputy planning and finance minister U Maung Maung Win said there is growing evidence that financial inclusion directly contributes to poverty reduction and sustainable livelihoods among poorer segments of society. Improving the livelihood of grassroots and the rural population is central to the government’s “collective financial inclusion aims,” he said.

“Economic development is not solely a means in itself. The nation’s economic advances are to have a real and lasting inclusive impact on households marginalised on the fringes of society. Financial inclusion is not for the benefit of the minority but to attain shared prosperity for all throughout the nation,” the deputy minister said.

There is “no better way” than enhancing access to sound financial products and services in order to bring prosperity to wide-ranging communities across the country, according to Liz Patterson, private sector development advisor at the UK Department for International Development (DFID) in Myanmar.

“Good financial services can be one of the tools that free people from the cycle of poverty. They allow families plan their finances, individuals to plan for their future and give real resilience to people and communities,” she remarked.

“Reforming and improving the regulatory and policy environment within Myanmar to increase financial inclusion is vital,” Ms Patterson added.

Crucially, financial inclusion helps create an economy which benefits the majority This is a solution for those economic developments which leave some segments of the population behind.

“…we know from experience that growth and increased development across the country do not necessarily guarantee equal opportunities for all, or mean that all communities will see their social and economic circumstances improved. Nor does it mean income and wealth divides will narrow.

“We know that despite advances over several decades, globalisation has led to income inequality actually worsening in some parts of the world – including in both developed and developing countries,” she said, stressing that financial inclusion will mean a lot to many families who are struggling to make ends meet,” she went on.

What it [financial inclusion] means is financial security for a family on the margins of poverty. It means having the finances to educate your children, so they can go on to find rewarding jobs when they leave school, and it means new services and opportunities for consumers across the country as well as a more prosperous life for poorer communities in Myanmar. – Liz Patterson, UK Department for International Development (DFID)

For UNCDF country coordinator Paul Luchtenburg, financial inclusion bears a real impact on reducing the inequalities between urban and rural areas as well as reduces gender inequality.

“The financial environment and technology have changed in Myanmar since we started our work in 2012, bringing the opportunity to reach more people than ever before,” Mr Luchtenburg noted, committing UNCDF to demonstrating the potential of financial inclusion for low-income people in this country.

In a panel discussion, Daw Phyu Yamin Myat, who founded Myanmar Development Partners Co., a microfinance social enterprise, argued that financial inclusion is one of the three essential pillars for economic empowerment. Individuals and businesses “need money to pursue development”.

The two other conditions which are equally important are the financial literacy and know-how, as well as a business-friendly environment where the government provides supportive policies, a clear rule of law, clarity in regulation and policies and basic infrastructure.

Armin Hofmann from German International Cooperation (GIZ) argued that as technology opened up new possibilities in the financial industry, regulators need to reassess the market and catch up with the laws and rules. Dino Ku, executive director of A-Bank, also said that the government is crucial in expanding access to finance because they set the policies and legal framework.

Source: https://www.mmtimes.com/news/financial-inclusion-crucial-reducing-inequality.html