<p>Laura  supports program operations, manages digital platforms and social media, and is the first line of contact for MFIs for the Smart Campaign.</p>
<p>Previously, Laura contributed to communications and community engagement at nonprofits including InterAction, Human Rights Connected, and the Worker Rights Consortium and was a Fulbright grantee to Colombia. She is the co-founder and communications and strategic partnerships manager at Open Americas.</p>
<p>Laura holds a graduate degree in international policy and development with a specialization in monitoring, evaluation, and program design from the Middlebury Institute of International Studies at Monterey.</p>


Former Communications and Operations Associate, Smart Campaign

Alex Kessler

Laura Schroeder

As the Smart Campaign winds down, we examine a decade of financial service provision guided by our consumer protection tools and discuss the evolution of consumer protection in light of disruptive digitization. This is the first in a series of blog posts about CFI’s experience working with FSPs, regulators, and investors on consumer protection, and highlighting opportunity areas for each stakeholder group.

Blog Post

When CFI <a href="https://content.centerforfinancialinclusion.org/wp-content/uploads/sites/2/2019/09/Ten-Years-of-Keeping-Clients-First-Final.pdf" target="_blank" rel="noopener noreferrer">launched</a> the Smart Campaign in 2009, global financial upheaval had revealed huge cracks in financial consumer protections around the world, including <a href="https://www.centerforfinancialinclusion.org/2009-microfinance-banana-skins-report" target="_blank" rel="noopener noreferrer">new challenges</a> for the inclusive finance sector. A lack of comprehensive consumer protection regulation covering microfinance institutions across the globe put vulnerable clients at risk. The industry faced inconsistent regulations at the country level and did not have a globally accepted framework describing appropriate consumer protection from the provider perspective. Steeped in an <a href="https://www.huffpost.com/entry/on-microfinance-whos-to-b_b_777911" target="_blank" rel="noopener noreferrer">over-indebtedness crisis</a> that threatened both the operations and reputations of microfinance institutions, the industry had an imperative to accelerate and amplify its individual consumer protection actions.

The <a href="https://centerforfinancialinclusion.org/about/what-we-do/consumer-protection/" target="_blank" rel="noopener noreferrer">Client Protection Principles</a> emerged as a shared set of responsible financial inclusion guidelines that would become the bedrock of the Client Protection Standards and <a href="https://centerforfinancialinclusion.org/about/what-we-do/certified-organizations/" target="_blank" rel="noopener noreferrer">Smart Certification</a>, and the infrastructure needed to support the implementation of good consumer protection practices: technical know-how through a community of experts and tools, access to funding through support facilities, and evaluations and capacity building for both providers and regulators. Since 2013, when CFI began certifying financial service providers (FSPs) that met adequate standards in their treatment of clients, 135 institutions in over 40 countries have earned Smart Certification, collectively serving over 62 million people. We also conducted over 120 trainings and 300 assessments, produced hundreds of tools for FSPs, and hosted convenings for thousands of financial inclusion professionals around the world, all part of a <a href="https://content.centerforfinancialinclusion.org/wp-content/uploads/sites/2/2019/09/Ten-Years-of-Keeping-Clients-First-Final.pdf" target="_blank" rel="noopener noreferrer">multi-pronged strategy</a> to raise awareness about the importance of consumer protection and improve providers’ practices.
<blockquote>Smart Certification has been awarded to 135 institutions serving 62 million people in 40 countries.</blockquote>
A cohesive landscape of investors and providers facilitated collaboration, enabled the uptake of certification, and created conditions in which clients could better access a range of financial services with confidence. Providers were <a href="http://smartcampaign.org/tools-a-resources/1172-consumer-protection-resource-kit" target="_blank" rel="noopener noreferrer">motivated</a> to undergo evaluations and seek certification in order to differentiate themselves as responsible actors, strengthen internal processes, attract investors, and improve relationships with regulators. <a href="https://responsiblefinanceforum.org/investor-guidelines/" target="_blank" rel="noopener noreferrer">Investors</a> adopted components of the standards into their due diligence and social impact assessments. Regulators have relied on our <a href="https://blogs.worldbank.org/psd/model-law-best-practice-financial-consumer-protection-important-driver-universal-financial-access" target="_blank" rel="noopener noreferrer">Model Legal Framework</a> (now known as the <a href="https://centerforfinancialinclusion.org/handbook-on-consumer-protection-for-inclusive-finance/" target="_blank" rel="noopener noreferrer">Handbook on Consumer Protection for Inclusive Finance</a>), which was recently updated for digital financial services. Regulators also used CFI’s <a href="https://centerforfinancialinclusion.org/client-protection-in-peru/" target="_blank" rel="noopener noreferrer">research</a> to design policies that balance client risk and market sustainability while taking the voices of both providers and clients into account. (For more resources and past consumer protection knowledge products, visit the Smart Campaign <a href="https://centerforfinancialinclusion.org/about/what-we-do/the-smart-campaign/" target="_blank" rel="noopener noreferrer">project page</a> on the CFI website.)
<h2>Changing Times Raise New Concerns for Client Protection</h2>
New actors, fintechs, and their investors are launching ventures aimed at serving unbanked and underbanked customers, hoping to use technology to scale their offerings beyond the reach of physical branches. Fintechs have entered the ecosystem at a rapid rate, particularly in growing markets, such as <a href="http://www.nairobibusinessmonthly.com/impact-of-fintech-on-kenyas-financial-services-industry/" target="_blank" rel="noopener noreferrer">Kenya</a> and <a href="https://www.techinasia.com/talk/state-fintech-cambodia" target="_blank" rel="noopener noreferrer">Cambodia</a>. Some of these companies have emerged under a loose banner of “inclusive fintech,” but many new entrants have different motivations and experiences than the providers that have traditionally sought to provide financial services to low-income customers. Fintechs that aim to serve this vulnerable segment may have good intentions, but many are also driven by different forces, including pressure to scale quickly in competitive markets, and commercial investors that are motivated more by returns than by development goals. As financial inclusion slogans increasingly appear in the <a href="https://www.bloomberg.com/news/features/2020-02-12/tech-startups-are-flooding-kenya-with-apps-offering-high-interest-loans" target="_blank" rel="noopener noreferrer">lexicons of fintechs</a>, these companies are largely unaccountable for their claims and, as non-bank entities, do not fall under existing consumer protection regulations.

Of course, many fintechs have genuine ambitions to advance inclusive finance and want to do everything in their power to prevent harm to their clients. Yet they face limits in what they can control due to fragmentation of the financial product delivery value chain. For instance, one credit product might involve an array of different companies: one that designs the credit model, another company contracted for collections, a bank that provides the capital, and the mobile network operator (MNO) that controls the digital rails. Because of this fragmentation, FSPs can find themselves as deal takers with limited influence over the practices of some partners.
<blockquote>Fintechs face limits in what they can control due to value chain fragmentation.</blockquote>
The new landscape compounds the challenges faced by regulators to improve consumer protection measures. Consumer protection is higher on the agenda than ever, as evidenced by findings of the annual <a href="https://centerforfinancialinclusion.org/global-microscope-2019/" target="_blank" rel="noopener noreferrer">Global Microscope</a>, an index that assesses the enabling environment for financial access in 55 countries across the globe, and the agenda set by the <a href="https://www.afi-global.org/" target="_blank" rel="noopener noreferrer">Alliance for Financial Inclusion</a> (AFI). Nonetheless, the progress that many countries have made to bolster consumer protection regulations and enforcement does not apply to new digital business models – either because these non-bank, non-microfinance entities fall outside current frameworks or because regulation has not yet addressed risks unique to digital financial services.
<h2>Building a Responsible Digital Ecosystem</h2>
As the inclusive finance ecosystem fragments and becomes more complex, CFI will shift its approach from codes of conduct and provider certification to focus on regulation, market conduct, and consumer research. With the <a href="https://centerforfinancialinclusion.org/cfi-celebrates-smart-campaigns-advancement-of-consumer-protection-announces-plans-to-transition-resources-to-industry-partners/" target="_blank" rel="noopener noreferrer">closure of the Smart Campaign</a>, our partners, SPTF and CERISE, will manage the Client Protection Standards going forward as a part of the Universal Standards for Social Performance. CFI will continue to manage the Client Protection Principles, which we believe can form the base of a shared language to understand consumer risks across the range of inclusive finance providers. CFI will continue to collaborate by engaging in research and learning that can be translated by our partners into practical tools for FSPs.
<blockquote>CFI will continue to collaborate by engaging in research and learning that can be translated into practical tools for FSPs.</blockquote>
To begin addressing the digitalization of financial services for the poor and the increasing complexity of the sector, CFI conducted <a href="https://centerforfinancialinclusion.org/a-framework-for-responsible-digital-credit/" target="_blank" rel="noopener noreferrer">research on digital credit</a> (including the <a href="https://centerforfinancialinclusion.org/client-protection-standards-for-digital-credit/" target="_blank" rel="noopener noreferrer">Client Protection Standards for Digital Credit</a>) to provide digital lenders with a shared set of criteria to assess their practices. CFI convened researchers, investors, and providers to discuss and debate good practices. These consultations revealed the following lessons:
<ul>
 	<li><strong>The relative importance of the Client Protection Principles are shifting in a digital world. </strong>Principle Six (Privacy of Client Data) has become a key consideration, while Principle Five (Fair and Respectful Treatment of Clients) may look vastly different when a business model leans toward tech over touch.</li>
 	<li><strong>Protection by design better aligns with fintech's faster product development and deployment cycles</strong>. Previously, the CPPs looked at established products and institutions, but the pace at which fintech products are brought to market and refined based on customer use shifts attention to the product development cycle as a crucial opportunity to embed client protection.</li>
 	<li><strong>Consumer protection needs an awareness boost</strong>. The Smart Campaign put consumer protection on the radar of FSPs by raising awareness of unintended consequences and convening stakeholders to identify practical solutions. It’s time to open this conversation to new investors and providers that are concerned about alarming trends in markets like <a href="https://centerforfinancialinclusion.org/red-flags-in-kenyas-nano-credit-market/" target="_blank" rel="noopener noreferrer">Kenya</a>, for example, to raise awareness again. In a rapidly evolving digital financial system, it is more important than ever to anticipate, understand, and catalog risks to consumers -- activities that will form the basis of CFI’s consumer protection agenda going forward.</li>
</ul>
<em>We’d like to thank the <a href="https://mastercardfdn.org/">Mastercard Foundation</a> for partnering with us on this journey.</em>

&nbsp;

&nbsp;

&nbsp;

FSPs Adopt Client Protection: A Look Back, A Look Ahead

Because of the pandemic, starvation might threaten an additional 250-plus million people in low and middle-income countries. SME financing, cash transfer programs and financial inclusion of women may boost food security for the most vulnerable.  

Scrolling through Instagram these days, I’ve noticed a pattern that has emerged since COVID-19 prompted lockdowns across the globe. With movement restricted, many social media users in the US have engaged in culinary adventures. New experiments in the kitchen abound despite the noted shortage of ingredients like flour on supermarket shelves.

But what I haven’t been seeing on my social media feed on the food front is much more dire: COVID-19 will push up to an estimated <a href="https://www.oxfam.org/en/research/dignity-not-destitution" target="_blank" rel="noopener noreferrer">half billion people into poverty</a> across the globe, threatening food security. Prior to the pandemic, approximately <a href="https://www.who.int/news-room/detail/11-09-2018-global-hunger-continues-to-rise---new-un-report-says" target="_blank" rel="noopener noreferrer">820 million people were chronically hungry</a>. Now, the World Food Program estimates that by the end of 2020, <a href="https://insight.wfp.org/covid-19-will-almost-double-people-in-acute-hunger-by-end-of-2020-59df0c4a8072" target="_blank" rel="noopener noreferrer">265 million people</a> in low and middle-income countries will be under the threat of starvation.
<h2>A Challenge for a Continent</h2>
These issues are particularly acute in several countries in Africa, where job losses and income losses are affecting food security, defined as access to sufficient, safe, and nutritious food. In a recent <a href="https://amref.zoom.us/rec/play/uZZ_Ju2p-zo3E9ed4wSDBKR6W9S9J_2s0iFP-qZemkixVXRQOlWkYuAbMLeKlvVOBygaPgBJmSDPJCzg?continueMode=true&amp;_x_zm_rtaid=FQWENb2fTM2AEbhvJuEg9g.1590501183404.6cee48bfc63a9f06cac60da22d85013d&amp;_x_zm_rhtaid=599" target="_blank" rel="noopener noreferrer">Africa Dialogues webinar</a>, hosted by Dalberg Advisors and Amref Health Africa and moderated by Lolem Ngong and Edwin Macharia, Professor Hamadi Iddi Boga of the Ministry of Agriculture, Livestock, and Fisheries in Kenya; Sara Menker, Founder and CEO of Gro Intelligence; and Monica Musonda, Founder and CEO of Java Foods, explored how the pandemic is disrupting agricultural supply chains and impacting smallholder farmers and vulnerable populations across the continent.

As Menker highlighted, there isn’t a lack of food around the world. Food insecurity, rather, is rooted in a massive distribution problem and a widespread inability to afford food, now exacerbated by COVID-19. Foreign exchange reserves across the African continent are at an all-time low due to the pandemic. In a weakened macroeconomic environment, the cost of imports has increased, and although some African markets are experiencing food insecurity to a greater extent than others, net importers of calories are finding themselves in an increasingly precarious situation. In Zambia, for example, the <a href="http://www.fao.org/giews/countrybrief/country.jsp?code=ZMB" target="_blank" rel="noopener noreferrer">price of fortified cereal</a> for children has increased to $6. Groups including informal workers, microentrepreneurs, and women tend to be the most adversely impacted by such price fluctuations.
<blockquote>Informal workers, microentrepreneurs and women tend to be the most adversely impacted by price fluctuations.</blockquote>
Musonda noted during the webinar that up to 60 percent of wages from informal work in Africa are used to buy food. Finding themselves without work, or with fewer working hours due to COVID-related restrictions on physical movement, informal workers and microentrepreneurs face increasing food insecurity, and women, who allocate more of their own resources to <a href="https://www.cgap.org/blog/3-ways-financial-inclusion-improves-womens-food-security" target="_blank" rel="noopener noreferrer">other members of the household during hardship</a>, are disproportionately affected.
<h2>How Does Financial Inclusion Come into Play?</h2>
As a well-documented <a href="https://www.uncdf.org/financial-inclusion-and-the-sdgs" target="_blank" rel="noopener noreferrer">enabler of food security</a>, financial inclusion has an important role to play in the mitigation of COVID-19’s harms to vulnerable groups. Here, I highlight a few of <a href="https://centerforfinancialinclusion.org/covid-19-reveals-the-limits-of-individual-action-and-market-based-solutions/" target="_blank" rel="noopener noreferrer">many considerations</a> for financial inclusion initiatives when taking action to reduce food insecurity.
<h3>Supporting SMEs and Smallholder Farmers</h3>
Propping up small and medium-sized business is an important consideration for financial inclusion and, by extension, food security in Africa. SMEs form an <a href="https://www.researchgate.net/publication/315516536_AFRICAN_SMALL_AND_MEDIUM_ENTERPRISES_SMES_CONTRIBUTIONS_CHALLENGES_AND_SOLUTIONS" target="_blank" rel="noopener noreferrer">integral part</a> of the food supply chain in Africa. According to Musonda, <a href="http://www.ipsnews.net/2019/09/smes-main-drivers-africas-food-economy/" target="_blank" rel="noopener noreferrer">SMEs handle 64 percent of food</a>, much of which is fresh and perishable, on the continent. These are the foods that are crucial, but we must do more to ensure that SMEs stay alive during this time of crisis.

This is where financial service providers (FSPs) play an important role. FSPs need to address both short-term and longer-term financing options for SMEs. In the short-term, as <a href="https://www.covid-finclusion.org/forum/discussion/surviving-the-liquidity-crunch-what-are-your-expectations-and-plans-for-managing-mfi-liquidity-what-worries-you-most" target="_blank" rel="noopener noreferrer">FSPs themselves are struggling with liquidity constraints</a>, the role of other actors, such as impact investors, development finance institutions, and policymakers, will be important to filling the void in available liquidity. But beyond liquidity through FSPs, there is a broader role for governments to play when it comes to food security.

In Kenya, the government has created an ecosystem of SMEs to support smallholder farmers in a mutually beneficial initiative that connects nodes of the supply chain. According to Prof. Boga, 90 percent of farmers in Kenya are smallholder farmers. To support this population, the government has created an ecosystem of SMEs to support them, and has implemented an e-voucher program in which farmers receive vouchers on their mobile phones to exchange for partially subsidized farm supplies based on their individual and household needs.
<h3>Promoting and Strengthening Cash Transfer Systems</h3>
Government-to-person (G2P) and person-to-person (P2P) <a href="https://blogs.worldbank.org/voices/responding-crisis-digital-payments-social-protection-short-term-measures-long-term-benefits" target="_blank" rel="noopener noreferrer">cash transfers are an effective strategy</a> to increase both financial inclusion and food security. NGOs, governments, and the private sector are working together to promote and strengthen this most important vehicle for quickly delivering crucial cash to low-income households and individuals. <a href="https://www.unicef-irc.org/publications/pdf/IRB 2016_04.pdf" target="_blank" rel="noopener noreferrer">Evidence</a> from several large-scale <a href="https://www.odi.org/sites/odi.org.uk/files/odi-assets/publications-opinion-files/7596.pdf" target="_blank" rel="noopener noreferrer">evaluations</a> shows that as households receive more in cash transfers, they spend more on food, with positive impacts on meals consumed and dietary quality.

The regulatory environment and payment infrastructure in many countries can present a challenge for massive payouts, but the financial inclusion community views the current crisis as an <a href="https://blogs.worldbank.org/voices/responding-crisis-digital-payments-social-protection-short-term-measures-long-term-benefits">opportunity to fast-track improvements to payments systems</a>, particularly through digital payments ecosystems. While digitalization is promising, however, CFI’s Alex Rizzi <a href="https://centerforfinancialinclusion.org/a-covid-digitization-stampede-mustnt-trample-consumer-protection/" target="_blank" rel="noopener noreferrer">cautions</a> that rushed pushes to go digital may harm the poor, and it will continue to be important to put base-of-the-pyramid consumers at the center of considerations for digital cash payments.
<blockquote>Countries with strong DFS infrastructures are taking the lead in implementing systems to help people afford food.</blockquote>
In Africa, countries with strong DFS infrastructures are taking the lead in implementing systems to help the base of the pyramid afford food and other living expenses. The Western Africa Central Bank (BCEAO) is promoting the use of electronic payment tools by making it easier for people to open a mobile money account and by making P2P transfers free. Kenya’s National Treasury <a href="https://www.ugogentilini.net/wp-content/uploads/2020/04/Country-social-protection-COVID-responses_April3-1.pdf" target="_blank" rel="noopener noreferrer">appropriated</a> an additional 10 billion Kenyan schillings, or $100 million, to support for the elderly, orphans and other vulnerable groups through cash transfers. In addition, fee waivers on P2P mobile money transactions on M-PESA were <a href="https://techcrunch.com/2020/03/16/kenya-turns-to-its-mobile-money-dominance-to-stem-the-spread-of-covid-19/" target="_blank" rel="noopener noreferrer">approved</a>. The Moroccan Economic Watch Committee activated a mobile payment device for cash transfers directly to an estimated 3 million informal workers, while in Tunisia, the government is offering one-off cash transfers to households with members working in the informal sector and housing the elderly.

To support governments and markets where the digital payment infrastructure is still developing, initiatives like the <a href="https://www.worldbank.org/en/topic/paymentsystemsremittances" target="_blank" rel="noopener noreferrer">World Bank’s G2Px</a> focus on bringing together expertise across sectors to scale G2P payments responsibly. NGOs such as the World Food Program <a href="https://www.wfp.org/cash-transfers" target="_blank" rel="noopener noreferrer">continue to employ cash transfers</a> in coordination with partners.
<h3>Supporting Women’s Financial Inclusion as a Means to Greater Food Security</h3>
Research indicates that within households, women are at a <a href="https://www.adb.org/sites/default/files/publication/30315/gender-equality-and-food-security.pdf" target="_blank" rel="noopener noreferrer">greater risk of being food insecure</a>. In times of hardship, such as the current pandemic, they are more likely to reduce their own food consumption to leave enough for men and boys. However, access to secure financial services <a href="https://www.cgap.org/blog/3-ways-financial-inclusion-improves-womens-food-security" target="_blank" rel="noopener noreferrer">has the potential</a> to <a href="https://elibrary.worldbank.org/doi/abs/10.1093/wbro/lkx003" target="_blank" rel="noopener noreferrer">promote women’s empowerment</a> and advance food security. Women with bank accounts are likely to have greater bargaining power to allocate more household resources to purchasing nutritious food. Increasingly, many donors and policymakers are recognizing the need to shift cash transfers to women as one approach to tackling food insecurity. This provides an <a href="https://elibrary.worldbank.org/doi/abs/10.1093/wbro/lkx003" target="_blank" rel="noopener noreferrer">on-ramp for digital financial services while improving convenience and confidentiality</a> of these payments.

Will our documentation of this moment in time capture the resilience, cooperation, and hard work of the individuals and institutions responding to this unprecedented crisis? Food security is a critical basic need, and financial inclusion is an important means of achieving it. With financial services digitizing at a breakneck pace, we mustn’t forget our most basic needs and how inclusive finance can serve them.

Food Security and COVID-19: How Financial Inclusion Can Support Livelihoods

Ezra Mannix

<p>Although Giridharadas has written a hard-hitting volume that maximizes impact with forceful storytelling, he only completes half of his task. He’s got a critique, but lacks specific, implementable ways to address societal inequalities. Much of what Giridharadas proposes in international development can at best be described as nebulous.</p>
<blockquote><p>We need to be continually learning, raising questions, and seeking feedback about best practices in financial inclusion.</p></blockquote>
<p>Perhaps the greatest service <em>Winners Take All</em> provides is to remind us that in this line of work, humility is key. No one has all the solutions, and even the best of our efforts can lead to unexpected results. We need to be continually learning, raising questions, and seeking feedback about best practices in financial inclusion. And we must take time for self-reflection, recognizing that we all – those who agree with Giradharadas and those he criticizes – must be cognizant of our own biases and consider how those biases affect our decisions.</p>
<p>Thank you for sparking the debate, Anand. Let’s keep working to make sure that the next time the wealth pie is placed on the table, everyone gets a fair share.</p>


We may be exactly the type of organization Giridharadas criticizes.


Imagine a large pie sitting on a table. The guests are hungrily eying it, and it’s time to dig in. One person lunges forward with his fork, grabbing the majority of the pie. After a brief pause, he looks around the room at dozens of hungry faces and offers up the small remainder. He mentions some leftover ingredients to make more pie in the kitchen, if anyone wants. Then, he sits down, patting himself on the back for his generosity.

This scenario illustrates the dynamic at the heart of a book that’s grabbed the attention of the international development community: <em><a href="https://www.amazon.com/Winners-Take-All-Charade-Changing/dp/0451493249">Winners Take All: The Elite Charade of Changing the World</a> </em>by <a href="http://www.anand.ly/about">Anand Giridharadas</a>. He charges that the “winners” of the world, who have a disproportionate majority of the world’s proverbial pie, don’t seem to realize that their efforts to “do good” are not only too small but also serve to reinforce the status quo and their own privileged positions.

When plutocrats are charged with making change, their <em>modus operandi</em> is not structural reform, Giridharadas argues. They fail to address the roots of inequality, instead attacking the symptoms of large, systemic issues. Giridharadas calls instead for robust democratic institutions that work to provide everyone with an equitable share.
<h2>Organizations Like Ours in the Crosshairs</h2>
Giridharadas notes how often interventions backed by the “haves” embrace market logic, aimed at “empowering” low income individuals to “pull themselves up by the bootstraps.”

The last sentence sounds familiar. We in financial inclusion do just that: we aim to empower low-income individuals. What’s more, we at the Center for Financial Inclusion are funded by <a href="https://www.centerforfinancialinclusion.org/get-involved/institutional-partnerships">large financial organizations</a>. Giridharadas might regard CFI as exactly the type of organization that is part of the problem.

But we see it differently.

Where Giridharadas sees superficial gestures, we see a process of fundamental change. The financial inclusion movement represents structural change in the way the financial system operates. Over the course of only a couple of decades, it has been opening a system previously only available to elites to now also serve the emerging middle class, the near poor, and the poor across the globe. The movement involves myriad players that work together in complex ways to build a financial system that is accessible to everyone who needs and can use financial services. These players include governments – especially financial regulators, but also social service agencies, telecoms regulators, etc. – and the private sector – banks, fintechs, microfinance institutions, telcos and others. The change, especially given the technology juggernaut that underpins it, has tremendous momentum.
<blockquote>Where Giridharadas sees superficial gestures, we see a process of fundamental change.</blockquote>
This is where CFI comes in. Our specific challenge is to ensure that the emerging system genuinely benefits its new users. As we often say, CFI challenges and engages the industry to better serve, protect and empower customers.

We attempt to look at financial services through the eyes of consumers, and we see that the newly-included require special attention, because they may face disadvantages including personal and business vulnerabilities, lower education, and social exclusion (like <a href="https://www.centerforfinancialinclusion.org/women-and-financial-inclusion-what-more-can-we-do-to-address-the-systemic-barriers-women-face">gender biases</a>). That’s why we have been exploring <a href="https://www.centerforfinancialinclusion.org/a-change-in-behavior-innovations-in-financial-capability-2">financial capability interventions</a> that can build a person’s ability to use financial services well. The focus of our work through the <a href="https://www.centerforfinancialinclusion.org/about/what-we-do/the-smart-campaign">Smart Campaign</a> is to ensure that financial service providers embrace sound consumer protection practices adapted to lower income populations – for example, transparency that goes beyond required information disclosure to confirm customer understanding. Our <a href="https://www.smartcampaign.org/tools-a-resources/1075">Client Voice</a> research is intended to make sure the experiences and concerns of clients inform all financial inclusion actors whether they are designing regulations or financial products. And our work on financial health keeps a focus on the ultimate purpose of financial inclusion: supporting customers to live healthy financial lives.

Giridharadas doesn’t explicitly mention financial inclusion in this book, and no one could blame him, since there’s so much ground to cover. However, we would be curious to get his take on it.

Our own take is that the financial system isn’t going away anytime soon, barring a complete reorganization of modern society – so the best strategy is to work within the system to make it as socially beneficial as it can be. Indeed, we recognize that clients, businesses, and the finance industry as a whole inhabit an ecosystem in which those with power must commit to shouldering the bulk of efforts to produce long-term, systemic change. We would love to see more financial institutions achieve <a href="https://www.centerforfinancialinclusion.org/the-next-100-smart-certifications">Smart Certification</a>. We would also like to see more and more financial institutions strengthen their governance practices in favor of customers – which is why the top requirement of our <a href="https://www.centerforfinancialinclusion.org/about/what-we-do/africa-board-fellowship-program/">Africa Board Fellowship</a> program has been for board fellows to talk face to face with customers.

Laura Schroeder

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