Building Inclusive Financial Systems
The Aspen Institute Financial Security Program sees Building Inclusive Financial Systems as a critical global strategy to maximize the financial security for all.
Around the globe, data shows a great convergence in the shared financial experience of people. As a result of increases in income volatility and income inequality, the economic challenges faced by low-income communities in the US and Europe are quite similar to those faced by much of the population in middle-income countries like Mexico, Brazil, Thailand, Malaysia, India, and South Africa.
To build more inclusive financial systems, many governments have established national “financial inclusion” initiatives designed to provide more people with access to the products, tools, and protections of a developed financial system. By doing so, these countries aim to improve the financial position of their most vulnerable citizens.
In the United States, the Federal Government has yet to establish such a domestic initiative, despite having both a long history of supporting financial inclusion initiatives globally, and a vibrant array of American organizations, academics, companies, and professionals who, collectively, comprise a robust “financial inclusion” field.
The opportunity before us is radically different than it was even ten years ago. Today – through rapid advances in technology, government agencies’ engagement in and support of responsible innovation, industry focus on quantifiable metrics around household financial outcomes, and the prospect of faster payments infrastructure – financial systems are evolving in real time. This moment provides a powerful opportunity to intentionally build the next generation of financial systems that are structurally, rather than post-hoc, inclusive.
What’s needed is a shared, global framework to guide innovators, regulators, and advocates collaboratively towards a common set of goals. Such a framework would leverage the global knowledge base around financial inclusion, leveraging lessons from other countries on the opportunity of new technologies to leapfrog old methods to advance access, usage, and last-mile connectivity and lessons from the US and Europe on regulatory frameworks and consumer protection. This will ensure that inclusion is fundamental to – rather than an afterthought of – the design of financial systems.
Aspen FSP’s current work in Building Inclusive Financial Systems is an initiative of the Global Inclusive Growth Partnership, a collaboration between the Aspen Institute and the Mastercard Center for Inclusive Growth. This work has been previously supported by the MetLife Foundation, The Prudential Foundation, the W.K. Kellogg Foundation, and JPMorgan Chase & Co.