barry whiteside : regulation and supervision of non - bank microfinance institutions opening speech by mr barry whiteside, acting governor of the reserve bank of fiji, at the regional off - site & on - site technical workshop on non bank microfinance institutions, suva, 12 – 14 april 2011. * * * my fellow governors, mr. denton rarawa ( cbsi ) and mr. loi bakani ( bpng ) central bank representatives from the region mr. tillman bruett, regional financial inclusion advisor and project manager, pacific financial inclusion programme mr deva de silva, senior operations officer, international finance corporation workshop facilitators mr. mark flaming and dr. mohamed nasir fellow colleagues from the reserve bank of fiji ladies and gentlemen introductory remarks bula vinaka to you all. it is with great pleasure that i welcome you all to suva for the first regional technical workshop on regulation and supervision of non bank microfinance institutions. it is an honor to help host this very important workshop that brings together regulators from around the region who are interested in the microfinance and financial inclusion agenda. microfinance and financial inclusion have become very topical issues on the global agenda, and a priority in many developing countries. it has been acknowledged that inclusive financial systems, where people regardless of income level, have easy access to various financial services, are critical for a country ’ s sustainable long term economic growth. in the region and in our individual countries we can attest that there are still significant numbers of our people excluded from basic financial services. in this regard, our active role in financial systems regulation, reform and policy development is important to set the scene and successfully implant the microfinance and financial inclusion agenda in our countries. an important element of inclusive finance is the institutions directly involved in extending financial services to the financially excluded. most of these institutions may operate outside the boundaries of central banks ’ regulatory and supervisory scope. in this workshop you will get to learn and devise practical approaches and methods that can be designed and adopted to effectively regulate such institutions. i wish to acknowledge the support and funding of the alliance for financial inclusion ( afi ), the pacific financial inclusion programme ( pfip ) and the international finance corporation ( ifc ), whose kind assistance have made this regional workshop possible. regulation and supervision of fiji ’ s financial system in fiji, the reserve bank is responsible for regulating and supervising the local financial system. this consists of the banking, insurance,

superannuation and foreign exchange industries. in 2009, our role was extended to include the capital markets industry. the reserve bank of fiji ’ s main role in this area is to maintain a stable and sound financial system that is fundamental to the country ’ s wellbeing. our major objective in this regard is bis central bankers ’ speeches the protection of the interests of depositors, creditors, members and policyholders, as well as maintaining confidence in the financial system by promoting its strength and integrity. interests in microfinance in the last 2 years, after the global financial and economic crisis, our interest and focus on microfinance and financial inclusion has become more prominent and is now one of our main development priorities, in addition to our core central bank responsibilities. we have come to realize that around 40 percent of our population may be excluded from any sort of financial services. also from a growing body of international research on policy implications and successes, it is widely acknowledged that the contribution of microfinance and inclusive finance is important for the sustained economic well being of a country in the long term. i believe we central bankers have critical decisions to make in our own countries. our policy decisions should facilitate a pro - growth inclusive financial system. in fiji, a part of our wanting to have an inclusive financial system was to ensure that the under - served low income and poor people have reasonable and affordable access to finance from financial institutions. we took our first steps towards this objective in 2009 by encouraging regulated financial institutions to undertake and extend affordable microfinance services. a microfinance policy was subsequently issued to all banks to conduct microfinance activities. i am pleased to say that the banks have taken on these requirements really well and are in compliance in one form or another. in terms of the affordability of microfinance services and financial services in general, we view technology as one means to address this issue, away from the traditional “ bricks and mortar ” setups. specifically, electronic methods to conduct financial and payment services, such as point of sale ( pos ) devices using stored value cards, and mobile phones using communication networks, are innovations that were well adapted to microfinance. some banks in fiji have now introduced wireless point of sale devices with their agents, with both withdrawal and deposit capabilities, to be used with stored value cards. these initiatives are clearly suitable for clients in rural or remote locations. also, some non - regulated private sector players, such as mobile network operators ( mno ),