AFI members visit El Zonte to learn how El Salvador adopted private digital currency

El Zonte (19 May 2022) – Banco Central de Reserva de El Salvador (BCR) and AFI are co-hosting the 25th Digital Financial Services Working Group (DFSWG) and 18th SME Finance Working Group (SMEFWG) meetings on 16-19 May 2022 in San Salvador.

The working group sessions, held for AFI members only, were a great opportunity to engage in technical discussions on how to foster a digital ecosystem and financial innovation, and support micro, small and medium-sized enterprises (MSMEs), women and more people with lower incomes and improving the regulatory and supervisory framework for consumer protection. As part of their technical exchange, AFI members are visiting El Zonte Beach to learn about the use of the private digital currency as a means of payment.

At the core of AFI is the concept of peer learning, as well as the sharing of knowledge and experiences among financial regulators regarding existing policies, rules, and experiences. Through the use of well-tested and focused exchanges, members are able to absorb valuable knowledge from their peers regarding particular financial inclusion solutions and issues.

The visit to El Zonte provides AFI members with an opportunity to gain hands-on knowledge of how small and medium-sized enterprises (SMEs) and individuals make use of private digital currencies in their day-to-day lives. Earlier on in the week, members of the AFI voiced concerns regarding issues pertaining to anti-money laundering and combating the financing of terrorism (AML/CFT), consumer protection, investor protection, and the introduction of such sophisticated products to underserved populations with limited financial and digital literacy. Members of AFI highlighted that this was particularly relevant to El Salvador and a wonderful opportunity for peer exchange; nonetheless, adoption is not a possibility in the majority of countries.

Since the onset of the pandemic, AFI members have prioritized business continuity, market stability, and consumer protection in their policy responses and actions. Special attention has been placed on policies that promote MSMEs and vulnerable groups, particularly the rural poor, women, the young, and those who have been forcibly displaced. These measures relating to small and medium-sized enterprises (SMEs) and digital finance have helped countries mitigate the negative consequences of the crisis and increase their resilience to future shocks.

About AFI

AFI is the world’s leading organization on financial inclusion policy and regulation. Over 100 member institutions make up the AFI network including central banks, ministries of finance and other financial regulators from 89 developing and emerging countries. AFI works on empowering policymakers to increase access and usage of quality financial services for the underserved through formulation, implementation and global advocacy of sustainable and inclusive policies: www.afi-global.org

AFI working groups are the primary mechanism for generating and hosting knowledge within the AFI network and provide a platform for knowledge exchanges and peer learning that allow technical members to internally share, deliberate and deepen their knowledge and understanding of key financial inclusion issues across various thematic areas.