Developing Capability

Key recommendations of the Task Force for enhancing citizen capabilities to benefit from sustainable digital financing ecosystems are:

Empower people to participate in and shape digital financing ecosystems as consumers, savers, taxpayers, borrowers, investors and service users is critical. This builds on the basics of digital infrastructure, digital ID, and ownership and control over personal data, and on the availability of relevant, affordable, user-friendly SDG-aligned products and services.

Overview of this Element

 

Element

 Icon ImageCitizen Rights and Capabilities

Recommendation
  • Invest in the capabilities and rights needed to empower citizens in making individual and collective decisions regarding the use of their money, in particular those most left behind (women, youth, displaced, aged).

Next steps

 Priority actions should include:

  1. Develop a coalition of citizen representatives committed to ensuring citizen voice in decisions of financial intermediaries.
  2. Financial regulators to extend citizens’ rights to information and involvement in financing decisions regarding the use of their money.
  3. Governments to reinforce their commitments to a goal of transparency of public finance, including budgets, procurement, and spending and provide roadmaps for achieving that goal.
  4. Financial regulators and supervisory authorities to develop strong consumer protection frameworks for digital financial services.
  5. Central banks and financial supervisory authorities to work with financial service providers and consumer protection groups to develop inclusive digital financial literacy strategies.

 

Citizen rights to transparent, fair, and appropriate digital financial services and protections against fraud, misuse, discrimination and exploitation must be guaranteed to deliver sustainable individual and collective outcomes. People should have the right to access transparent, fair, respectful, appropriate, affordable digital financial services, including payment, savings, credit, insurance, and investment. Associated customer protection measures at a minimum guarantee equitable treatment, transparent disclosure, financial education, responsible business conduct, protection against fraud or misuse, protection of customer data and privacy, complaint handling and redress, and competitive service offer.

An evolution of that approach might involve adopting a broader, user-empowering lens and connecting consumer protection and financial stability to individual outcomes and positive collective, sustainable development outcomes. This requires mobilizing policymakers and regulators from various domains to ensure that consumer protection measures address all major risks and have sufficient coverage, and to strengthen  citizens’ capacity to direct how their money is being used, with strong involvement and commitment from all citizen representatives.

Developing people’s awareness, trust and capabilities is crucial. Many have access but lack digital skills or trust in the digital world, especially women, elderly and other disadvantaged groups. National efforts to enhance digital financial literacy for all population groups, including by leveraging technological solutions, are critical to scaling of sustainable digital financing ecosystems. citizens’ awareness of their ability to make SDG-aligned financing decisions comes mainly through markets, communities and families rather than formal training. Marketing of local sustainable development investment vehicles therefore involves familiarising people with new investment products and ideas. Operational capabilities are likely to come through use rather than any classroom training, with strong evidence of generational ‘leaps’ in such capabilities. Collective capabilities and execution are likely to play an important role, for example at the community and city level, potentially involving trade unions, religious groups and other institutions supporting group action.

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Key recommendations of the Task Force for enhancing citizen capabilities to benefit from sustainable digital financing ecosystems are:

Empower people to participate in and shape digital financing ecosystems as consumers, savers, taxpayers, borrowers, investors and service users is critical. This builds on the basics of digital infrastructure, digital ID, and ownership and control over personal data, and on the availability of relevant, affordable, user-friendly SDG-aligned products and services.

Overview of this Element

 

Element

 Icon ImageCitizen Rights and Capabilities

Recommendation
  • Invest in the capabilities and rights needed to empower citizens in making individual and collective decisions regarding the use of their money, in particular those most left behind (women, youth, displaced, aged).

Next steps

 Priority actions should include:

  1. Develop a coalition of citizen representatives committed to ensuring citizen voice in decisions of financial intermediaries.
  2. Financial regulators to extend citizens’ rights to information and involvement in financing decisions regarding the use of their money.
  3. Governments to reinforce their commitments to a goal of transparency of public finance, including budgets, procurement, and spending and provide roadmaps for achieving that goal.
  4. Financial regulators and supervisory authorities to develop strong consumer protection frameworks for digital financial services.
  5. Central banks and financial supervisory authorities to work with financial service providers and consumer protection groups to develop inclusive digital financial literacy strategies.

 

Citizen rights to transparent, fair, and appropriate digital financial services and protections against fraud, misuse, discrimination and exploitation must be guaranteed to deliver sustainable individual and collective outcomes. People should have the right to access transparent, fair, respectful, appropriate, affordable digital financial services, including payment, savings, credit, insurance, and investment. Associated customer protection measures at a minimum guarantee equitable treatment, transparent disclosure, financial education, responsible business conduct, protection against fraud or misuse, protection of customer data and privacy, complaint handling and redress, and competitive service offer.

An evolution of that approach might involve adopting a broader, user-empowering lens and connecting consumer protection and financial stability to individual outcomes and positive collective, sustainable development outcomes. This requires mobilizing policymakers and regulators from various domains to ensure that consumer protection measures address all major risks and have sufficient coverage, and to strengthen  citizens’ capacity to direct how their money is being used, with strong involvement and commitment from all citizen representatives.

Developing people’s awareness, trust and capabilities is crucial. Many have access but lack digital skills or trust in the digital world, especially women, elderly and other disadvantaged groups. National efforts to enhance digital financial literacy for all population groups, including by leveraging technological solutions, are critical to scaling of sustainable digital financing ecosystems. citizens’ awareness of their ability to make SDG-aligned financing decisions comes mainly through markets, communities and families rather than formal training. Marketing of local sustainable development investment vehicles therefore involves familiarising people with new investment products and ideas. Operational capabilities are likely to come through use rather than any classroom training, with strong evidence of generational ‘leaps’ in such capabilities. Collective capabilities and execution are likely to play an important role, for example at the community and city level, potentially involving trade unions, religious groups and other institutions supporting group action.

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Pathfinder Initiative: Sustainable Digital Finance Measurement Framework
Pathfinder Initiative: East Africa: Regional Digital Financing Ecosystem