Different economic policies and policy areas, such as fiscal policy, labor market policy, structural policies to improve competition, etc., can be distinguished according to their objectives, the policy instruments that are suitable for achieving the objectives, and the authority or authorities controlling the instruments and responsible for achieving the objectives. Monetary policy in the form of flexible inflation targeting has the objective of stabilizing both inflation around the inflation target and resource utilization around a normal level. The suitable instruments are under normal circumstances the policy rate and communication, including possibly a published policy-rate path and a forecast of inflation and the real economy. In times of crisis, as we have seen during the current crisis, other more unconventional instruments can be used, such as fixed-rate lending at longer maturities, asset purchases and foreign-exchange intervention to prevent currency appreciation. The authority responsible for monetary policy is typically the central bank. Financial-stability policy has the objective of maintaining or promoting financial stability. The available instruments are under normal circumstances supervision, regulation and financialstability reports with analyses and leading indicators that may provide early warnings of stability threats. In times of crisis, there are instruments such as lending of last resort, variable-rate lending at longer maturities, special resolution regimes for financial firms in trouble, government capital injections and so forth. The responsible authority or authorities vary across countries. In some countries it is the central bank, in other countries there is a separate financial supervisory authority, sometimes the responsibility is shared between different institutions.

Deposit accounts have increased from 19,738 deposit accounts per 10,000 adults in year 2000 to 29,311 deposit accounts per 10,000 adults this year. Similarly, there has been significant increase in loan accounts from 3,105 loan accounts per 10,000 adults to 8,600 loan accounts per 10,000 adults. More than 80% of our adult population have some form of deposit accounts. The ranking by World Bank’s Consultative Group to Assist the Poor shows that Malaysia is in the 20th position globally, [Singapore is in the 16th position; Thailand: 33rd; Indonesia: 70th; and the Philippines: 71st]. While we have made considerable progress in improving financial inclusion agenda, the Bank is unrelenting in our aspiration to shape our financial system to be more inclusive and effective in supporting a balanced economic growth for our country. Our financial sector Blueprint that will chart the direction of development of our financial system in the next ten years places a high priority on the financial inclusion agenda. Among the areas of focus are the development of cost efficient delivery channels that will enhance the outreach of financial services, expand the range of products and services to meet the distinct financial needs of the underserved and strengthen the institutional arrangements to enhance the capacity of providers of such financial services. Equally, important will be the attention accorded to financial consumer education and protection in which the standards of consumer care are high and consumers have choices and are confident about making their financial decisions.