Financial Literacy Crucial for Sustainable Microfinance

July 13, 2009

Financial literacy has a key role to play in creating sustainable microfinance, the Governor of the Reserve Bank of Fiji, Sada Reddy said at the opening of the Pacific Microfinance Week that started in Nadi today.

“Microfinance is critical in reducing poverty,” said Mr Reddy speaking to microfinance and financial sector practitioners, experts, policy-makers, academics and regulators attending the Pacific Microfinance Week.

He emphasised that microfinance initiatives need to be supported by financial literacy.

“Providing microfinance services only is not sufficient. It needs to be backed up with education and training programmes,” said Mr Reddy, and acknowledged the work done in the area of financial literacy by the United Nations Development Programme (UNDP) in this area.

Financial literacy will be the focus of a one day workshop session on Wednesday and will be conducted by the Pacific Financial Inclusion Programme PFIP, one of the sponsors of the Pacific Microfinance Week.

PFIP is a Pacific-wide programme helping provide sustainable financial services to low income households. It is funded by the United Nations Capital Development Fund (UNCDF), European Union and the United Nations Development Programme (UNDP) and operates from the UNDP Pacific Centre.

“One of the key aims of PFIP is to bring financial services to the poor, working with commercial banks, microfinanceinstitutions and others to do so. Through the Pacific Microfinance Week we wish to share knowledge on new ways to deliver services to reach the unbanked. Our workshops on financial literacy and microinsurance (on Thursday) will generate a lot of interest amongst financial sector professionals and the general public, given the current global environment in which people are looking for ways to better manage and save money,” said Tillman Bruett, Pacific Financial Inclusion Advisor.

Other topics that will be discussed during the week includes the role of commercial banks in microfinance; the impact and opportunities new technologies can provide for microfinance; networking opportunities to convene and advance ideas for financial inclusion; current and planned support from bilateral and multilateral donors for financial inclusion; building financial literacy in the Pacific; microinsurance; the role of central banks and other policy-makers; and, the value of credit bureaus.
 

Note to editors:

Pacific Microfinance Week 2009 is an initiative of the Microfinance Pasifika Network and facilitated by The Foundation for Development Cooperation with support from sponsors. The lead sponsor for this event is the International Finance Corporation (IFC), while supplementary sponsors include; The Pacific Financial Inclusion Programme (PFIP); AusAID; Fiji Development Bank (FDB); the Reserve Bank of Fiji (RBF); the National Centre for Small & Micro Enterprises Development (NCSMED); and, Fern Software.

 

For further information contact:
Shobhna Decloitre, Communications Associate, UNDP Pacific Centre on shobhna.decloitre@undp.org or (679) 9779521