HIS EXCELLENCY DR. ABDULRAHMAN BIN ABDULLAH AL-HAMIDI, DIRECTOR GENERAL AND CHAIRMAN OF THE BOARD OF DIRECTORS OF THE ARAB MONETARY FUND DELIVERS A SPEECH ON THE OCCASION OF THE ARAB FINANCIAL INCLUSION DAY

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HIS EXCELLENCY DR. ABDULRAHMAN BIN ABDULLAH AL-HAMIDI, DIRECTOR GENERAL AND CHAIRMAN OF THE BOARD OF DIRECTORS OF THE ARAB MONETARY FUND DELIVERS A SPEECH ON THE OCCASION OF THE ARAB FINANCIAL INCLUSION DAY
 2021-04-27

The importance of digital financial transformation in facing unemployment challenges and achieving sustainable economic and social development

The efforts of the authorities in the Arab countries to develop legislation, regulations and regulatory frameworks and their role in improving the spread of digital financial and banking services and encouraging innovation

Increasing interest in the digital financial services industry in the Arab region

Launching an index of modern financial technologies in the Arab countries

 

His Excellency Dr. Abdulrahman bin Abdullah Al-Hamidi, Director General, Chairman of the Board of Directors of the Arab Monetary Fund, delivered a speech during the media conference held "remotely" on the occasion of the Arab Day for Financial Inclusion approved by the Board of Governors of Central Banks and Arab Monetary Institutions, which falls on April 27 of each year Its activities for this year will be launched under the slogan "The Role of Digital Transformation in Promoting Financial Inclusion ."

His Excellency indicated that the celebration of the Arab Day for Financial Inclusion this year comes in light of the increasing economic and financial challenges resulting from the spread of the Corona pandemic, which in turn strengthened the importance of accelerating the transition to digital financial services and applications of modern financial technologies, which would contribute to the success of the measures taken. By the Arab countries to achieve the desired goals in reducing the negative repercussions of the spread of the Corona pandemic.

His Excellency the Director General of the Chairman of the Board of Directors of the Arab Monetary Fund stressed that overcoming the challenges facing Arab economies resulting from the pandemic requires mobilization of efforts and resources to support digital transformation, because of its impact in facing unemployment challenges and achieving sustainable economic and social development, referring in this regard to estimates The Arab Monetary Fund, which shows that Arab economies will achieve a growth rate of 2.8 percent and 3.6 percent for the years 2021 and 2022, respectively, after recording a contraction of about 4.4 percent from the year 2020, affected by the repercussions of the pandemic, noting in this regard that the success of the recovery and compensation The economic losses of the pandemic depend on the recovery of global demand on the one hand, and the continuation and deepening of economic reforms in Arab countries on the other hand, as digital financial inclusion takes an important place in the scope of structural reform.  

In the same context, His Excellency explained the great opportunities inherent in the development of digital services, noting in this regard that about 85 percent of adults in the Arab region have a mobile phone, 48 percent of those who have a mobile phone can access the electronic network at the same time, and 7 % Have a mobile phone account, and about 33% send or receive digital payments, compared to about 44% globally.

On the other hand, His Excellency Dr. Al-Hamidi praised the care taken by the authorities in the Arab countries on issues related to improving levels of financial inclusion and access to digital financial services of acceptable quality and costs, and giving them importance and priority within the framework of the economic policies taken, referring in this regard to the efforts of the authorities in Arab countries To develop legislation, regulations and regulatory frameworks that help improve the spread of digital financial and banking services and encourage innovation in this field, in addition to following up efforts to upgrade sound digital infrastructure systems for the financial and banking system and encourage the development and expansion of non-banking financial services.His Excellency also praised the increasing interest that central banks and Arab monetary institutions attach to issues of protecting consumers of financial services, pointing to their keenness to develop policies and programs that enhance transparency in digital financial and banking transactions, in order to establish confidence in the financial system on the one hand, and on the other hand serve the purposes of awareness and education. Digital Finance.

In another context, His Excellency indicated that the digital financial services industry is witnessing growth in the Arab region, referring in this regard to international reports that show the contribution of these activities to about 4 percent of the gross domestic product of Arab countries, indicating in this regard that there is a continuous increase in The number of modern financial technology companies, and that the number of companies operating in the digital financial services industry in the Arab countries by the end of 2020 was estimated at 500 companies, more than half of them are emerging companies, compared to 167 companies five years ago and 62 companies only ten years ago.

In a related context, His Excellency affirmed the great interest that the Arab Monetary Fund attaches to the topics of modern financial technologies and their applications, in recognition of the great opportunities offered by these technologies in light of the repercussions of the Corona pandemic, indicating in this regard that the fund has organized a large number of meetings and workshops "remotely." ", For experts on the applications of modern financial technologies in Arab countries during the year 2020, which discussed the role of the modern financial technology industry in the wake of the pandemic, the challenges of digitally enrolling customers, digital identity and electronic Know Your Customer rules, and focused on ways to confront electronic threats and exchange information about them.

His Excellency also indicated that the fund's activities to support digital transformation during the year 2020 witnessed great momentum within the framework of the financial inclusion initiative for the Arab region, through the activities of the regional working group for modern financial technologies. In this regard, His Excellency referred to a vision document on the “Framework for Digital Financial Transformation in the Arab Countries”, issued by the Fund in September 2020, which aimed to support the efforts of Arab countries in terms of digital financial transformation and the development of digital services, and dealt with the requirements and steps of digital financial transformation. In the Arab countries, it presented an integrated vision for the transition to digital financial services and the requirements of policies and technologies to build an environment conducive to its development in the Arab countries.

His Excellency Dr. Al-Hamidi also referred to the set of guiding principles and guides that were issued through the group of modern financial technologies, which included issues of digital identity, KYC rules in Arab countries, electronic safety of financial infrastructure in Arab countries, and building national strategies for modern financial technologies. And guidelines for alternative financing for Arab countries, and open banking operations. His Excellency also indicated that the Fund has launched a regulatory guide on "Modern Financial Technologies in the Arab Countries", which aims to introduce the modern financial technology industry in the Arab countries, and includes the regulatory frameworks for the manufacture of these technologies and the legislation related to them. In the context of its keenness to promote digital financial literacy in the Arab countries, and in the fund’s belief in the importance of having a reference for modern financial technology terminology, His Excellency Al Hamidi referred to the “Modern Financial Technology Terminology Handbook”

In a related context, His Excellency announced the  launch of an index for modern financial technologies in the Arab countries , the first of its kind, that sheds light on the progress of Arab countries and their efforts in the field of modern financial technologies, and the challenges they face in this field, indicating that the index will help the fund in following up Progress to the modern financial technology industry in our Arab countries, and it will provide the supervisory authorities with a tool for developing appropriate policies in this regard.

In conclusion, His Excellency affirmed that the Arab Monetary Fund will spare no effort or means to contribute to supporting the endeavors of our Arab countries in promoting financial inclusion, upgrading its indicators, and supporting efforts and initiatives aimed at promoting digital transformation in Arab countries.

 

The following is the full text of the speech:

 
Ladies and Gentlemen,


May God bless your good morning.

I am pleased to welcome you all on the occasion of the Arab Financial Inclusion Day for the year 2021. As you know, the approval of the Excellencies Governors of Arab Central Banks came today, in recognition of the great importance that the issues of enhancing access to finance and financial services have acquired in support of achieving comprehensive and sustainable economic growth and enhancing economic and financial stability And the importance of enhancing awareness in this regard.

  

I would like to take the occasion of the Arab Financial Inclusion Day to extend my thanks and gratitude to the Central Bank of the United Arab Emirates and the Federation of Emirates Banks for cooperating with the Arab Monetary Fund in reviving activities that concern the banking sector and promoting financial inclusion and digital financial transformation.

Today we celebrate this occasion, and the accelerating international developments and challenges cast a shadow over the economies of the countries of the world, in light of the economic and financial challenges resulting from the spread of the Corona pandemic, as the importance of the transition to digital financial services and the applications of modern financial technologies emerged, due to the positive role they play in promoting financial inclusion, This would contribute to the success of the measures taken by governments to achieve the desired goals in reducing the negative repercussions of the spread of the pandemic. To achieve this, there is a need to enhance awareness of the use of the formal financial system and conducting digital financial operations, in line with the slogan of this year's Arab Financial Inclusion Day, which is "The Role of Digital Transformation in Promoting Financial Inclusion."

There is no doubt that overcoming the challenges facing Arab economies resulting from the Corona pandemic requires mobilization of efforts and resources to support digital transformation, because of its impact in facing unemployment challenges and achieving sustainable economic and social development. The Arab Monetary Fund estimates that Arab economies will achieve a growth rate of 2.8 percent and 3.6 percent for the years 2021 and 2022, respectively, after recording a contraction of about 4.4 percent from the year 2020, affected by the repercussions of the pandemic. The success of the recovery and compensation for the economic losses of the pandemic will depend on the recovery of global demand on the one hand, and the continuation and deepening of economic reforms in Arab countries on the other hand, as digital financial inclusion takes an important place in the scope of structural reform.

Ladies and Gentlemen,

The revival of the Arab Financial Inclusion Day aims to contribute to increasing the definition of financial inclusion and its requirements in the Arab countries and the related issues, policies and programs. This also comes within the framework of the keenness of the Arab countries to achieve the goals of sustainable development 2030, and to reach the inclusiveness of financial services for all groups of society in the Arab countries.

There is no doubt that the conditions that the countries of the world are going through in general, and the Arab countries in particular, make it imperative that we all join hands to enhance the awareness of the Arab public on the need to use official financial systems and make digital payments, and to reduce dependence on the use of cash in transactions. Therefore, we take this opportunity to urge our Arab countries to take advantage of the revival of the Arab Day of Financial Inclusion, by reviewing their programs of activities, and launching large campaigns to encourage the use of digital financial services, taking into account the instructions, procedures and official efforts undertaken by Arab governments in the context of their fight against the Corona pandemic.

 Ladies and Gentlemen,

There is no doubt that the negative repercussions of the Corona pandemic clearly highlighted the great importance of employing modern technologies for the purposes of financial inclusion, and the need to enhance digital financial services and educate their users. The Coronavirus pandemic has boosted the demand for digital financial services, and has made the need to accelerate digital transformation and improve digital financial services a critical issue in economic policies in the Arab region.

Available statistics show the great opportunities inherent in the development of digital services, as about 85 percent of adults in the Arab region have a mobile phone, 48 percent of those who have a mobile phone can access the electronic network at the same time, and 7 percent have mobile accounts. And about 33 percent have sent or received digital payments, compared to about 44 percent worldwide, and these statistics are witnessing a steady increase to highlight the opportunities available to accelerate digital financial transformation in the Arab countries.

The authorities in the Arab countries are keen to continue to give priority to improving levels of financial inclusion and access to digital financial services of acceptable quality and costs, and to accord them importance and priority within the framework of the economic policies taken. The authorities in the Arab countries are also working to develop legislation, regulations and regulatory frameworks that help improve the spread of digital financial and banking services and encourage innovation in this field, in addition to following up efforts to upgrade sound digital infrastructure systems for the financial and banking system, and encourage the development and expansion of non-banking financial services. In this context, the authorities also attach special importance to issues of protecting consumers of financial services, as central banks and Arab monetary institutions are keen to develop policies and programs that enhance transparency in digital financial and banking transactions, in order to establish confidence in the financial system on the one hand, and on the other hand serve the purposes of awareness. And digital financial education.

Ladies and Gentlemen,

It is well known to you that the great importance attached to digital financial inclusion policies and strategies today, as enhancing the ability to access financial services for various segments of society, especially those who are deprived of the financial system, has become a major goal of economic policy makers, due to its positive impact on financial and social stability and development. Economic. There is no doubt that the speed of employing modern technologies will help in light of the young nature of our Arab region in achieving the desired goals.

In this context, the importance of the Arab Financial Inclusion Day, in which central banks and Arab monetary institutions cooperate with financial and banking institutions, technology and communications bodies, ministries of education, civil society organizations and media institutions, comes to shed light on issues of digital financial inclusion and raise awareness about them.

We are grateful in this regard, for the activities and activities carried out by central banks and Arab monetary institutions to raise awareness of financial inclusion. We also thank the Arab banks that, on the occasion of this day, took the initiative to launch initiatives and promote a number of financial services and products, which enhance the opportunities for different groups of society to access formal financial services. We also look forward to a wider contribution from the Arab media and press in spreading awareness, on this occasion.

Ladies and Gentlemen,

The digital financial services industry is witnessing growth in the Arab region. According to international reports, digital activities contribute about 4 percent of the Arab countries ’GDP. There is also a continuous increase in the number of modern financial technology companies, approaching about 500 companies in 2020, more than half of them are emerging companies, compared to 167 companies five years ago and 62 companies only ten years ago.

As for the most widespread sectors of using modern financial technologies in our Arab countries, payments and transfers account for the largest share of modern financial technology fields in Arab countries, with 44 percent of the solutions provided by modern financial technology companies. These solutions include digital wallets for mobile phones and portals. Payment via the international network of information.

Ladies and Gentlemen,

 The Arab Monetary Fund pays great attention to the topics of modern financial technologies and their applications, in recognition of the great opportunities that these technologies offer in light of the repercussions of the Corona pandemic. The fund’s activities to support digital transformation during the year 2020 witnessed great momentum within the framework of the Financial Inclusion Initiative for the Arab Region, in cooperation with the initiative's partner institutions, foremost of which is the German Development Agency. As well as through the activities of the regional working group for modern financial technologies, which includes technicians and experts from Arab countries from the public and private sectors, experts from regional and international financial institutions, service providers, institutions and leading bodies in this field at the regional and international levels.

In the context of enhancing dialogue on digital financial transformation, the Fund organized, during the year 2020, a large number of "remote" meetings and workshops for experts on the applications of modern financial technologies in the Arab countries. The meetings discussed a number of important topics, including the role of the modern financial technology industry in the aftermath of the pandemic, the challenges of digitally enrolling customers, digital identity, and online Know Your Customer (KYC) rules. The meetings also focused on ways to confront electronic threats and exchange information about them. The meetings paid attention to discussing the safety of applications for open banking operations, the available opportunities and the related challenges, as well as the opportunities that modern financial technologies can provide to central banks. On the other hand, they discussed the topic of supervisory and supervisory technical solutions to support the supervisory and supervisory authorities in the Arab countries, and how to benefit from these solutions in the performance of their tasks.

Also, in the field of supporting digital financial transformation, the fund was keen to support the efforts of Arab countries in strengthening the regulations in support of the use of modern financial technologies and providing the appropriate infrastructure to support the transition to digital financial services. In September 2020, the fund issued a vision document on the “framework for digital financial transformation in Arab countries". The document aimed to support the efforts of Arab countries in terms of digital financial transformation and the development of digital services, as it dealt with the requirements and steps of digital financial transformation in the Arab countries, and presented an integrated vision for the transition to digital financial services and the requirements of policies and technologies to build an environment conducive to its development in the Arab countries. The fund is currently working on the basis of the axes of action included in the document, to build partnerships with various regional and international financial institutions and global development agencies to support the endeavors of digital financial transformation in the Arab countries.

In the same context, the Fund has worked, through a group of modern financial technologies, to issue a set of guides and guidelines, including issues of digital identity, KYC rules in Arab countries, electronic safety of financial infrastructure in Arab countries, building national strategies for modern financial technologies, and financing guidelines. The alternative for Arab countries, and open banking operations. The fund also launched a regulatory guide on "Modern Financial Technologies in the Arab Countries". The guide aims to introduce the modern financial technology industry in the Arab countries, and includes the regulatory frameworks for the industry of these technologies and the legislation associated with them. The guide included regulatory and supervisory provisions and procedures, licensing requirements for companies, and sectoral distribution of licensed companies.   

On the other hand, and in the context of its keenness to promote digital financial literacy in the Arab countries, and the fund’s belief in the importance of having a reference for modern financial technology terminology, the fund issued a “modern financial technology terminology guide” in three languages ​​(Arabic, English, French) covering all financial technology terms. Modern circulating.

Today, we celebrate the occasion of the Arab Day for Financial Inclusion by launching an index of modern financial technologies in the Arab countries, the first of its kind, as it sheds light on the progress of Arab countries and their efforts in the field of modern financial technologies, and the challenges they face in this field, based on an annual questionnaire that covered six axes Head of building and developing the modern financial technology industry. I take this opportunity to thank all the Arab central banks that responded to the questionnaire. There is no doubt that the index will assist us in monitoring the progress of the modern financial technology industry in our Arab countries and will provide the supervisory authorities with a tool to develop appropriate policies in this regard.

Ladies and Gentlemen,

Building a societal culture that is aware of the opportunities and risks in financial services represents a continuous process of improving financial awareness, especially for young people, so the Arab Monetary Fund has launched a number of booklets for young people with the aim of contributing to awareness efforts, hoping that these booklets will contribute to achieving the desired purpose.

Before concluding, I would like to emphasize on this occasion that the Arab Monetary Fund will spare no effort or means to contribute to supporting the endeavors of our Arab countries in promoting financial inclusion, looking forward to the regional initiative for financial inclusion in Arab countries to contribute to achieving the desired objectives in this regard.

Finally, I do not miss on this occasion, except that I reiterate my thanks and gratitude to the country of the headquarters of the Arab Monetary Fund, the United Arab Emirates, for the great facilities it provides that contribute to the success of the fund in its pursuit of its goals.

 
Peace, mercy and blessings of God,,
 

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