Q&A with Banco de Moçambique Governor Ernesto Gove

AMPI’s new Chair on his vision for AMPI and DFS opportunities for Africa

The Governor of the Bank of Mozambique, Mr. Ernesto Gouveia Gove, was elected in February 2016, as the new Chair of the African Mobile phone Financial Services Policy Initiative (AMPI) for the period 2016 -2018. He provides some light on DFS opportunities for Africa and his vision for AMPI in this Q&A.

How has Africa been able to maintain its leadership in the digital financial services field?

As we all know the majority of the African population, approximately 1.1 billion inhabitants distributed over 30 million km², live in rural areas. These areas are generally not attractive to the traditional commercial banks due mostly to the limitations of basic infrastructure and prevalence of subsistence economic activities. Nevertheless, most of the mobile network operators have made efforts in rural areas to provide network coverage, resulting in an increase of the number of mobile phone users in the continent, including those with low levels of literacy.

Access to mobile network services creates an opportunity for mobile financial services providers to reach more of the population, especially those with no access to traditional banking. The expansion of mobile phone access has been a key driver for Africa’s leadership in the field of digital financial services (DFS). The simple mobile phone has created an opportunity for African countries to:

• Provide access to basic financial services to the majority of the population, thus overcoming the infrastructure limitations of traditional banking;
• Create specific financial products and services that are simplified and adjusted  to low-income population, such as farmers and micro entrepreneurs, mostly in rural areas;
• Disseminate information about the advantages of using financial services through financial literacy or education campaigns, etc.

Financial policymakers and regulators in Africa are taking full advantage of these opportunities. This is one of the reasons why AFI member institutions from Africa decided to launch, in 2013 the African Mobile phone Financial Services Policy Initiative (AMPI), a regional initiative of the AFI network. In simple terms, AMPI is a platform where officials from regulatory bodies and private sector entities share views with the aim to find appropriate ways to promote Mobile Financial Services (MFS) in Africa. With all these efforts, Africa is demonstrating effective leadership in DFS for the benefit of people living in remote areas of the continent.

What kind of impact is AMPI having on policy development?

AMPI is a peer-learning and knowledge-sharing platform for successful DFS policies. The initiative has proven to be a valuable resource for dialogue on promoting access to and usage of quality financial services through digital means. It is helping AFI member institutions in Africa to learn from each other and to adopt holistic approaches in designing and implementing policy measures to deepen financial inclusion.

Through AMPI, high-level officials from financial policymaking and regulatory bodies have great opportunities to exchange experiences among themselves and to discuss openly with representatives from financial services providers and international development agencies with the view to determine effective policy solutions to advance MFS / DFS in Africa. This is invaluable, as it has been allowing us to get information on how to overcome certain barriers and to be mindful of promoting business models and financial services that are suitable to low-income population. In addition, the peer-learning model of AFI and the flexible approach, which we follow in implementing AMPI Strategic Plan, are helping us to articulate and adjust our national policies on financial inclusion.

• For example, during the 4^th AMPI Leaders Roundtable that took place in Dakar in February 2016, we agreed to add a 5^th objective to the Strategic Plan on “Promoting the development and implementation of policies to enhance financial inclusion for women”. As we all know, women constitute an active segment of the African population with specific needs, which are usually neglected in policy formulation. Agreeing to act collectively at regional level to improve women access to quality financial services helps regulators and policymakers to take appropriate actions on the issue in their respective countries.
• Thanks to the synergies provided by AMPI we have also made substantial progress in refining our policies by incorporating measures to suit the needs of low-income and people living in rural areas. AMPI amplifies our efforts in various ways, including through tailored capacity building and high-level coordination.

With the above examples, I can say that AFI through AMPI is helping us to develop and implement innovative policy solutions.

As a new AMPI chairperson, what will be the priorities for the initiative during your term?

The value of AMPI is clear. So, we will be taking the necessary actions to ensure that the financial resources needed to implement the AMPI Strategic Plan are in place. In collaboration with the AFI Management Unit, we will continue the actions taken by my predecessors towards our partners to broaden the funding sources of the initiative. Other priorities include:

• Continue the regulatory capacity building activities with the aim to equip the technical staff of AFI member institutions in Africa and help them to have a better understanding of emerging technologies and their implications on policy formulation.
• Complete the review of the AMPI Strategic Plan and make sure that the annual work plans reflect members’ needs and interests.
• Finalize the AMPI Charter as agreed by AMPI Leaders during our 4^th Annual Roundtable in Dakar.
• Ensure that an increasing number of financial regulators in Africa participate in AMPI’s activities.
• Ensure that the telecommunication regulators join the AMPI’s activities and the high-level discussions on a regular basis with the view to facilitate the collaboration among all the stakeholders to better address service users’ needs.

We will also work to establish a physical presence of AMPI in Africa. Through our efforts and the shared vision of AFI Board of Directors, an AFI Regional Office will be established in Africa in the coming months, which will also coordinate and manage the activities of AMPI. We will work with the AFI Management Unit to achieve this important milestone line with our vison to institutionalize AMPI and broaden its funding sources.

What would be the advantages to having an AFI Regional Office based in Africa to support AMPI?

AFI is an international organization with a headquarter (Management Unit) based in Kuala Lumpur. I believe that establishing an AFI Regional Office in Africa will ensure greater proximity to AFI members in Africa and will help to serve members more efficiently.

It will be an advantage for AFI members in Africa to have a Regional Office on the continent with a dedicated team that will coordinate and manage AMPI’s activities, with support from AFI headquarters. I think it will result in a more efficient use of resources, which will enhance AFI’s ability to support members in sharing regional knowledge, working on specific regional challenges and priorities and translating global financial inclusion issues into practical implementation.

The Regional Office will also give more visibility to AMPI’s activities in Africa, facilitate the organization of regional meetings and reinforce collaboration with partners on specific regional issues.

The Addis Ababa Action Agenda had a strong focus on financial inclusion as a key to reaching the 2030 SDGs goals. How will AMPI contribute to this effort?

One of AMPI’s objectives is to promote innovative policy solutions to support financial inclusion in African countries, through the use of digital technologies, with the aim to improve the lives of marginalized populations. With the revision of the AMPI Strategic Plan, we have broadened the scope of AMPI beyond MFS to take into account the gender dimension in financial inclusion policy making, as well as the synergy between MFS and microfinance institutions (MFIs). All these are highlighted in the “Actions areas” of the Addis Ababa Action Agenda (AAAA) adopted in July 2015. As indicated in the AAAA, Heads of States and Government Officials pledged to expand peer learning and experience-sharing among countries and regions, including through AFI of which AMPI is a regional initiative. In this regard, AMPI can be seen as an implementing arm of the AAAA.

What do you think will be the most interesting innovative DFS technology or trend for Africa?

There is a myriad of interesting DFS innovative through which operators in Africa are impacting the life of marginalized people. Contactless technologies (near-field communication), digital currency, biometric technologies and many more innovations are helping to facilitate electronic payments in even the most remote locations, while reducing the costs and complications of traditional banknotes and coins. However, the digitization of information and transactions has only just started to show its full potential. The possibilities are endless. One thing I am confident about is that, with the help of AMPI, Africa will continue to lead the way in DFS innovations.

ABOUT THE AUTHOR
Efoé Koudadjey is the Regional Coordinator, Sub-Saharan Africa/Mena, at the Alliance for Financial Inclusion (AFI).