is that building a sound consumer and data protection framework with evolving capabilities is critical. before i conclude, a few words are in order about the role of regulators in the sector. it is essential that they ensure the innovations in the financial sector are conducted safely, i. e., without jeopardizing financial stability or consumers. this requires that regulators remain knowledgeable of the new and emerging technologies, in addition to being nimble so as to provide timely guidance. given the unknown risks with these innovations, a pilot “ test and learn ” approach may be adopted, and through which the necessary safeguards are applied to mitigate the potential risks. this approach worked for us at the central bank of kenya when we took the initial steps with mobile money services. as regulatory perimeters become blurred, financial sector regulators must establish links with other regulators, governments, private sector, and other stakeholders. in this complex scenario, consumers will become more vulnerable and will rely on the regulators to protect them. regulators will also need to guide the maintenance of sound governance and practices at all levels. in closing, i want to underscore that a great deal of innovation and innovative thinking is needed to ensure that the benefits from greater financial inclusion are fully realized. there are risks, but in the words of van gogh, “ the fishermen know that the sea is dangerous and the storm terrible, but they have never found these dangers sufficient reason for remaining ashore. ” thank you!

4th fmo ’ s future of finance conference theaterhangaar, katwijk, netherlands keynote address by dr. patrick njoroge governor, central bank of kenya september 26, 2016 as prepared for delivery good morning! i am greatly honored to be here today. i would like to thank the dutch development bank ( fmo ) for organizing this conference on the important theme future of finance, their gracious hospitality, and the invitation to speak to such a distinguished audience on the impact of disruptive technology on financial inclusion. new technologies have profoundly transformed societies the world over. in the last decade, we have witnessed an unprecedented upsurge of technology - driven innovations that are transforming africa ’ s economic landscape. coupled with globalization — the other significant trend of our time — these innovations offer immense possibilities for achieving inclusive economic growth, sustainable development, and poverty reduction. the outcomes with respect to financial services in kenya and the rest of sub - saharan africa, have so far been astounding. in the words of nelson mandela, “ it always seems impossible until it is done. ” this conference provides an excellent opportunity to reflect on kenya ’ s journey of embracing innovative and disruptive technology as a tool for financial inclusion, and the challenges and opportunities that lie ahead. an analogous example may be appropriate and illustrative. it is evident how profoundly dutch masters changed the art of painting, as their disruptive innovations challenged the existing paradigms and offered new possibilities that were previously unimaginable. it is also significant that rembrandt and van gogh absorbed studiously the methods of the time before launching their careers and developing their own innovative approaches. embracing this same spirit, let me first turn to a few considerations of the current setting. first, mobile phone technology has allowed kenya to make substantial progress in financial inclusion. there are some 38. 3 million mobile phone subscribers in kenya, a penetration rate of 89 percent. in addition, the network of mobile money agents has grown significantly, from 527 agents in june 2007 to 164, 465 in june 2016. these factors have allowed access to formal financial services to expand from 26 percent in 2006 to over 75 percent currently. 1 similar improvements in financial inclusion have been witnessed in other countries in the region — recently reported numbers are mauritius at 88 percent, south africa at 83 percent, rwanda at 68 percent, tanzania at 57 percent, and nigeria at 48 percent, and democratic republic of congo at 36 percent. second, compared to similarly - situated countries, kenya has