Bankable Frontier Weblog

I have just returned from a most interesting conference on “Massifying access to financial services” arranged by the Banking Association of Colombia, Asobancaria, from 6–7 September 2007. The conference circuit on this topic is somewhat crowded at present, but this event was noteworthy for two reasons in particular.

First, the organizers did a great job of assembling presenters on a diverse range of leading international models for promoting access to financial services on a commercial basis. These included Banco Azteca which in five years has become one of Mexico’s largest retail banks by number of customers; Banco de Estado de Chile, a public sector bank which has been innovative in promoting new instruments to reach low income segments; ProCredit Holdings, whose assets now exceed $5 billion and continue to grow strongly; and then ICICI Bank from India which continues to innovate across a broad range of retail services; and also new generation mobile payment services G-Cash from Philippines and Wizzit from South Africa. Presentations should be available soon via the Asobancaria events page.

President Uribe greets delegates at the Asobancaria event

Second, the President of Colombia, Alvaro Uribe, appeared on the second day to start proceedings; and showed a remarkable command both of the issue of the financial inclusion; as well as need to balance political considerations such as Colombia’s controversial interest rate cap. This was recently softened through a special provision for higher rates (up to 34.7% effective) for microloans. While in this era of a Nobel Prize winner and of celebrity support for microfinance, it is more common for politicians to endorse the cause. It is not common, however, for Presidents directly to show this level of interest and knowledge—Presidential spouses are often left to carry this flag in countries like Uganda and South Africa! And it is not all talk in Colombia: in recent years, the country has demonstrated a remarkable commitment to pro-access policy reform and is now implementing ‘smart subsidies’ to improve access points through a state program, Banca de las Oportunidades. Increasingly, Colombia offers useful examples of policy and regulatory best practice to the rest of the world. But these are the subject of future blog post.