From a financial stability perspective, it is about introducing riskier and less experienced borrowers into the financial system. Hence, the implementation aspect is critical, especially in the attempt to balance the trade-offs between financial stability and inclusion. This is never an easy task. For every success of microfinance, we have seen some failures. One example that comes to mind is the case of a large Asian economy in 2010 where the unrestrained growth of micro lending led to high debt stress among borrowers, financial instability, and sensationalized newspaper accounts of suicide among borrowers. 1/4  BIS central bankers' speeches  However, these challenges must not sway our resolve to further the cause of microfinance. We must continue to find new and more efficient implementation strategies. Forums such as this give us an opportunity to examine these issues more closely, and share successes and pitfalls so that others might benefit. We therefore welcome the publication of the World Bank’s report on financial inclusion in Malaysia which we hope will also hold useful lessons for others. Malaysia has devoted significant focus to the sustainable development of microfinance over many years to boost growth and improve welfare. More than 75% of businesses in Malaysia are micro enterprises, and 40% of Malaysia’s households earn incomes below USD850 (RM3,650) a month. The view that distribution, not just aggregate growth matters, is therefore, a view that resonates strongly with us. William Faulkner, the famed American writer and Nobel laureate, once spoke of the all-important virtue of “trying until we get it right”.

Notably, this includes the formation of a dedicated platform with the Securities Commission and other stakeholders to streamline measures for development of the national alternative finance ecosystem. Additionally, initiatives such as the deployment of Dana Penjana under Penjana Kapital, a 1-to-1 matching program for funds raised by venture capitals, are important public private partnerships utilising alternative finance to spur early-stage innovation. The investee companies here today, involved in a variety of innovative fields across finance, are testament to this. Beyond regulator or government-led efforts, capital market intermediaries – such as asset managers and large institutional investors – can also play a critical role in mobilising capital more actively to firms, especially SMEs and start-ups. For now, a large proportion of venture capitalbacked deals in Malaysia remains facilitated by the public sector entities. There is considerable room to increase private sector involvement here. Another potential avenue for unlocking investor funds could be through greater Corporate Venture Capital (CVC) participation in VC funding activities. By investing in the VC firm, as opposed to the start-up itself, the technical know-how in start-up investing could be built up over time, without the instance of crowding-out VCs through direct competition in deal flow. Closing Let me conclude. The Digital Era is already upon us. In the next few years we will see more advancements and some of this, are unknown to us today. Some of you as industry entrepreneurs have a better vision on this.