involvement in enhancing their growth. the services provided by the mfis should be seen as complementary to the services provided by other licensed financial institutions ( lfis ) in both the rural and urban areas of png. other recent positive developments initiatives in this area are : the proposed partnership arrangements between banks and post png, and separately with the government ’ s district treasury offices. like all other developing countries, png is constantly challenged to provide answers or ways as to how best it can wrestle the problems associated with poverty and lack of employment opportunities. its 5 million population, of which 80 % live in the rural areas have been denied development opportunities for many years, partly due to the deterioration in infrastructure conditions and lack of banking services. given these challenges, we recognized that the weaknesses of the financial system needs to be addressed in order to improve the provision of financial services required for private sector development. this includes addressing the lack of banking and financial services in the rural communities. the recent surge in cases of various forms of money schemes are an outcome of this problem. the central bank has taken actions on some of these schemes and will continue to be vigilant in eliminating such practices. in addressing this problem, the government requested the asian development bank ( adb ) to provide technical and funding assistance in developing the microfinance sector in png. subsequently, this led to the establishment of the png - adb microfinance and employment project, which commenced in 2000. the project ’ s overall objective is to contribute to economic growth through private sector development and employment creation and further development of the financial system. the specific objective of the project is to provide sustainable microfinance services to viable formal and informal enterprises and savings services to the population at large. regarding regulation of mfis, there is currently no regulation in place to govern the activities of mfis. however, the bank is in the process of developing an appropriate regulatory and supervisory regime that would support the development of mfis and legally protect and equip them to serve the urban and rural communities of png. as deposit - taking institutions, these mfis are required by the central bank to be duly incorporated and operate legally within a prescribed set of rules to ensure sustainability in the future. since there is no regulatory framework in place to license mfis, the central bank gave conditional license to the wau microbank ( wmb ) under the existing banks and financial institutions act 2000 to operate as a licensed financial institution

speech by : loi m bakani cmg, governor, bank of png at the uncdf 50th anniversary 19 january 2017 ladies and gentlemen, it is my pleasure to address you all at this momentous occasion marking uncdf ’ s 50th anniversary. the bank of papua new guinea has had a close relationship with uncdf through the pacific financial inclusion programme ( pfip ) since its inception in 2008. i would like to share with you some of pfip ’ s highlights over the past 9 years. on a regional level, pfip has been instrumental in supporting the role of the central banks in driving the financial inclusion agenda, and actively contributes to the pacific islands regional initiative, a knowledge - sharing platform for the central banks in the pacific region. by the end of september 2016, pfip had reached an impressive cumulative total of over 1. 1 million clients across the pacific, already surpassing the programme ’ s 2019 goal of 1 million clients. these clients are now connected with financial service providers through a variety of financial services including bank accounts, mobile money, micro insurance, microfinance and more. closer to home for us, in papua new guinea alone, pfip partnerships have led to over 400, 000 clients receiving some form of financial service. in papua new guinea, pfip has been supporting the bank of png and the centre for excellence in financial inclusion through support for development and implementation of the country ’ s national financial inclusion strategic plans, the second of which ( spanning from 2016 - 2020 ), you may be aware, was launched recently in december 2016. this new plan has the ambitious target of reaching 2 million more unbanked lowincome papua new guineans, 50 % of whom are women, by 2020. bima is one example showing the tremendous need and potential for financial service in papua new guinea. a recent entrant into the insurance market, bima provides convenient, affordable life and hospitalization insurance cover via a mobile platform to nearly 400, 000 often low - income, financially underserved papua new guineans, the majority are receiving the economic safety net of insurance cover for the first time. pfip ’ s investment grant helped bima expand outreach in the highlands region, reducing delivery costs and improving customer service through and expanded agent network. pfip is currently working with the with department of education, provincial government and bank of png to develop a pilot for financial education integration into technical and vocational