Aligning financial inclusion and financial integrity

Tran, Thu Thi Hoai; Koker, Louis de

doi:10.1108/jmlc-01-2019-0004

Cited by 3 publications

(4 citation statements)

References 5 publications

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“…The results reinforce a technological opportunity to simplify the KYC and AML procedures that currently limit underserved populations' access to banking services. Such simplifications make sense as these populations are predominantly not dangerous clients and simply lack the skills to comply with such requirements (Tran and De Koker 2019) or the availability or willingness to provide data (Macchiavello and Siri 2022). From a technological standpoint, one way to do this is by providing layered-permission access solutions through innovative APIs, as suggested by Romanova et al (2018) in relation to the security and privacy risks related to OB.…”

Section: Discussionmentioning

confidence: 99%

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Open banking and inclusive finance in the European Union: perspectives from the Dutch stakeholder ecosystem

Preziuso,

Koefer,

Ehrenhard

2023

Financ Innov

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In the European Union (EU), the revised Payment Services Directive (PSD2) aims to provide more convenient and customized financial products through open banking (OB) platforms. However, little attention has been paid to the role of OB in improving the financial well-being of the growing number of the EU’s underserved groups, which currently constitute approximately a quarter of its population. This study examines how the PSD2 and OB impact inclusive finance in the EU based on the perspectives of the Netherlands’ ecosystem, one of the leaders in the EU’s financial technology (FinTech) landscape. A fundamental distinction can be drawn between the OB users and the ecosystem’s players. Regarding the impact of financial services on the users’ inclusivity, while the PSD2 strengthens the infrastructure necessary for financial inclusion, many challenges remain, mainly because it was not designed for this purpose. This study identifies several areas of improvement that include adjustments to the know your customer and anti-money laundering processes for underserved customers, innovative ways to communicate the PSD2’s potential, and the regulation of technology providers’ activities to build trust. Meanwhile, from the ecosystem’s position, there is a need to strengthen and improve microfinance regulation according to the opportunities provided by the PSD2 to support microfinance institutions (MFIs) in scaling up and reaching underserved clients across borders with innovative services. OB improvements can also be achieved by organizations formed by MFIs and FinTechs in collaboration with banks. Such hybrid institutions will combine the best features of each of them: knowledge of the needs of local underserved clients from MFIs, technological innovations from FinTechs, and large and trusted customer bases, infrastructures, and access to institutional investments and governments from banks. Finally, an EU inclusive OB sector depends on the centrality of trusted regulators as coordination bodies.

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Section: Discussionmentioning

confidence: 99%

“…Research on microfinance in Vietnam has shown the necessity to simplify anti-money laundering (AML) and KYC procedures for two reasons (Tran and De Koker 2019). First, their customers' activities are unlikely to be associated with terrorism or money laundering.…”

Section: Challengesmentioning

confidence: 99%

Open banking and inclusive finance in the European Union: perspectives from the Dutch stakeholder ecosystem

Preziuso,

Koefer,

Ehrenhard

2023

Financ Innov

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“…(Babajide et al, 2017;Değermen Erenkol et al, 2015), meningkatkan kesetaraan gender. Owusu-Danso (2015) serta meningkatkan inklusi keuangan (Ginanjar & Kassim, 2021) mampu malayani semua segmen sosial sehingga kemiskinan bisa lebih mudah diperangi (Bishwakarma, 2017;Ginanjar, 2015;Othman, 2015;Sarker, 2013;Tran & De Koker, 2019) serta meningkatkan literasi digital (Mushtaq & Bruneau, 2019).…”

Section: Pendahuluanunclassified

Penerapan Manajemen Risiko untuk Meminimalkan Perguliran Bermasalah di UPK-BKM Wilayah Kecamatan Pecangaan

Hazmi,

Utami,

Choeri

et al. 2023

JPPM

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UPK-BKM di wilayah kecamatan Pecangaan mengalami permasalahan Non-Performing Loan (NPL) yang sangat tinggi. Hal tersebut disebabkan karena permasalahan (1) Penyaluran pinjaman dilakukan secara peer-to-peer lending oleh ketua koordinator dengan ketua Kelompok Swadaya Mandiri (KSM) sehingga tidak transparan (2) Penanganan pinjaman dilakukan sentralistik tanpa melibatkan peran masing-masing pengurus (3) Lemahnya sistem kolektibilitas kredit. (4) Tidak mempunyai tata kelola risiko yang baik. Metode pelaksanaan pengabdian dilaksanakan dengan Inhouse Training, pendampingan pembuatan Standar Operation and Procedure (SOP) dan Risk Mapping untuk merubah pola kerja perguliran dana yang terkonstruk sejak lama dengan pola perguliran dana yang baru dengan transparansi melalui center-meeting pada saat pencairan dana serta memasukan unsur Mubadalah atau saling melengkapi atau menggantikan antara suami atau istri ataupun penjamin pada penyaluranya atau penerimaan dana. Kegiatan pendampingan lapangan penanganan perguliran dana yang terlanjur macet (NPL existing) melalui pola rescheduling, reconditioning, restructuring, refinancing. Kegiatan tersebut dilaksanakan selama delapan bulan dengan hasil berupa penambahan perguliran macet baru sebesar 0%. UPK-BKM in the Pecangaan sub-district area is encounter tremendous non-performing Non-Performing Loan (NPL) volumes. This is due to problems (1) Loan distribution is carried out peer-to-peer lending by the head of the coordinator with the head of the Independent Self-Help Group (KSM) that is making lending distribution not transparent (2) Loan handling is carried out centrally without involving the role of each administrator (3) Weak credit collectibility system. (4) Needing good Risk Management. The method of implementing the service is carried out with In-house Training, assistance in creating Standard Operations and Procedures (SOP), and Risk Mapping to change the workflow of fund lending which has been constructed for a long time with a new fund lending flow with transparency through center-meeting at the time of disbursement of funds and including elements of Mubadala is it complement or replace each other between husband or wife or guarantor in the distribution or receipt of funds. Field assistance activities for handling the circulation of funds that are already stuck (existing NPL) through rescheduling, reconditioning, restructuring, and refinancing models. This activity was carried out for eight months with results in the form of an increase in new Non-Performing Financing (NPL) weighted 0%.

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“…Evans (2018) finds that factors such as capital formation, bank credit, broad money, population growth, remittances, interest rate and regulatory quality significantly influence the level of financial inclusion. Tran and De Koker (2019) argue that strong anti-money laundering (AML) and combating terrorism financing (CFT) regulatory frameworks for microfinance institutions can help to align financial inclusion policy objectives with financial integrity in the activities of microfinance institutions. Ozili (2020b) in a recent review of literature, finds that financial inclusion affects, and is influenced by, the level of financial innovation, poverty levels, the stability of the financial sector, the state of the economy, financial literacy, and regulatory frameworks which differ across countries.…”

Section: The Policy Literaturementioning

confidence: 99%

Financial Inclusion and Fintech during COVID-19 Crisis: Policy Solutions

Pk¹

2020

SSRN Journal

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Aligning financial inclusion and financial integrity

Cited by 3 publications

References 5 publications

Open banking and inclusive finance in the European Union: perspectives from the Dutch stakeholder ecosystem

Open banking and inclusive finance in the European Union: perspectives from the Dutch stakeholder ecosystem

Penerapan Manajemen Risiko untuk Meminimalkan Perguliran Bermasalah di UPK-BKM Wilayah Kecamatan Pecangaan

Financial Inclusion and Fintech during COVID-19 Crisis: Policy Solutions

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