Making financial services meet the needs of the world’s most vulnerable
People living in poverty constantly juggle an evolving set of risks and crises in their daily lives. Climate change, the pandemic, and the ongoing food crisis, among others, have increased these risks substantially, contributing to a rise in global poverty and inequality. Meanwhile, a third of the world’s adult population lacks the financial services they could use to significantly improve their lives. CGAP is working to change this, and we believe that positive trends in inclusive finance offer hope for a green, resilient, and inclusive future.
Despite gains in financial inclusion, several populations at the "last mile" remain excluded. This Note, prepared by CGAP, the World Bank, and the Better than Cash Alliance for GPFI, provides a framework for the necessary public infrastructure and regulatory enablers to reduce the barriers commonly faced by these last mile segments and emphasizes the need for more targeted policies and investments to address non-financial barriers.
Open finance frameworks have the potential to increase innovation, boost competition, empower customers, and deepen financial inclusion. However, they also introduce new risks that necessitate careful design and robust safeguards. As more countries explore or implement these frameworks, CGAP, BIS, IMF, UNSGSA, and the World Bank offer key considerations for designing effective and inclusive open finance frameworks.
This working paper presents an analytical framework to identify the potential exclusionary effect of climate-related financial sector regulation on the incentives and ability of financial service providers to lend to vulnerable segments in emerging markets and developing economies. The analysis is backed by evidence gathered from three countries: Bangladesh, Brazil, and Colombia.
Featured Topics
An inclusive financial system empowers vulnerable people to pursue their own climate resilience strategies, making it an absolute necessity for a just transition.
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.
Rural women face disproportionate threats from climate stresses and shocks compared to men.
Featured Platforms and Resources
