The Monetary Authority of Singapore is partnering International Finance Corporation and the World Economic Forum on initiatives to advance digital inclusion through financial services, with aim to reduce inequalities for people and smaller businesses in emerging and developing economies.
The partnership will focus on finding ways to better mobilise financing to make digital services more affordable and accessible for underserved individuals and communities, and micro, small and medium-sized enterprises (MSMEs) with the support of financial institutions and FinTech companies.
"This will include creating guidelines to promote safe use of digital financing instruments in the Asian market," MAS said.
An example for financing instrument could be a five-year digital inclusion bond, issued by a bank to support and empower a specified number of small businesses with access to e-commerce capabilities, online products, and digital educational resources.
IFC, with its extensive network of financial institutions and financial-support mechanisms, will drive the development of the guidelines, "as a public knowledge piece, which may cover digital financial inclusion products, eligible assets, and measurement and reporting mechanisms."
The IFC is a member of the World Bank and offers investment, advisory and asset management services to encourage private-sector development in less developed countries.
MAS would explore synergies with its other initiatives such as the SME Financial Empowerment and Financial Transparency Corridor Programmes to improve financing access.
The Forum, a global non-government foundation for public-private cooperation said it will leverage its deep international network of government and private sector partners to promote and share these new solutions and learnings.
IFC's regional industry director for the financial institutions group in Asia Pacific said the challenge to improve digital inclusion for billions of people in emerging and developing markets is significant, and traditional financing mechanisms alone cannot address this challenge.
He added that innovative financial instruments and guidelines are needed to mobilise the trillions of dollars needed to improve digital inclusion.
WEF's executive committee member, Sebastian Buckup said the partnership is vital to turn recommendations into concrete steps so that financing could go towards digital public infrastructure, digital skills, and digital services for the underserved.
