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Jan 31, 2020

The main theme of Session Four included the discussion on how the needs of financial consumers living in urban environments differed from those in rural and remote locations. The discussion included government policies to ensure that everyone is financially included, regardless of where they lived. Panelists deliberated on how to objectives set were achieved in practice and the most effective ways of reaching people and who needed to take responsibility of these goals set.


 Dr Lillian Koh Noi Keng, CEO, Fintech Academy, Singapore


1. Mr Suman Raj Aryal, Director General, Central Bureau of Statistics, Nepal

2. Ms. Leigh Coughlan, Senior Manager, Australian Securities and Investments Commission, Australia,

3. Mr Lyndwill Clarke, Head of Department, Consumer Education, Financial Sector Conduct Authority, South Africa.

 The moderator for the session was Dr Lillian Koh Noi Keng, CEO, Fintech Academy, Singapore. The panelists of session were: (i) Mr Suman Raj Aryal, Director General, Central Bureau of Statistics, Nepal, (ii) Ms. Leigh Coughlan, Senior Manager, Australian Securities and Investments Commission, Australia, and (iii) Mr Lyndwill Clarke, Head of Department, Consumer Education, Financial Sector Conduct Authority, South Africa.

The first panelist, Mr Suman Aryal, Director General of Central Bureau of Statistics, started with some statistical data on distribution of establishment by (i) district and (ii) distribution of number of people engaged by presenting a map of Nepal. Mr Aryal presented recent data published by 'Central Bureau of Statistics' about the result of economic census which reflected the differences between urban and rural Nepal. Mr Aryal explained that the first maps provided various insights like the establishment for 'agriculture', 'transport', 'financial services industries', 'hydropower', and 'hotels'. He further added that the map clearly depicted the differences in location of service, which showed the establishment bias based on geographical location as majority of services were located in Kathmandu Valley, the capital city of the country and the Terai region. Mr Aryal pointed that the 'Person Engaged' map showed similar scenario/condition. Majority of people were engaged in establishments which are located in the Kathmandu Valley and Terai region.

             By comparison of the two maps from the Census Report, subjective analysis like labor absorption rate, labor force participation, employment-population ratio, output differences, inequalities, etc., could be drawn. His presentation also gave some insights of industry mix and some anomalies in urban fringe

              Further, he added that economic census registered almost 9924 establishments in the country out of which 50 percent were registered with 1.19 percent of them being financial services establishments. There are only 17000 financial service providing institutions set up as 'functional establishments' only whereas registered financial service providers are not enumerated and recorded yet. This data implies that for every functional establishment, there are less than 2 financial service institutions.

               He shared insights on 'Urban-Rural Disparity'. Mr Aryal mentioned that 36 percent of old age population resided in the rural areas. He clarified that though the unemployment rate was not very much high, the gap was significant if unemployment was compared to population ratio. This disparity signaled about major activity mix/ industry. Further, he explained that majority of rural population continued their job in their home only in the form of unstructured and micro business. He concluded that there was unlimited opportunity of activity mix/industry in rural areas where there was low level of retail marketing network and low level of financial services. Further he emphasized that lack of above two factors were the major gaps for several industry mix. He clarified that some of the urban areas were not urban areas in the true sense and hence gave rise only to an urban fringe. This led to some of issues of 'Human Cost' such as cost of living, lack of basic services including financial services, undernourishment, and remoteness. In some remote areas of Nepal, it took more time to get basic services that added to hardships of life. He argued that urban areas should be reclassified on the basis of a National Urban Standard. He believed that from the analysis of presented data, migration was the interdependence factor between urban and rural Nepal.

               The second panelist, Ms. Leigh Coughlan, Senior Manager, Financial Capability, Australia, gave a brief presentation about Australian context of Financial Education and Financial Inclusion with respect to urban, regional, and remote populations. Ms. Leigh started her presentation with the picture showing the remoteness of Australia by population. She shared that some 70 percent of the population is concentrated in urban areas in Australia.

                She also presented Australia as 'Very Remote Australia', 'Remote Australia', 'Inner Regional Australia', 'Outer Regional Australia', and 'Major cities of Australia'. Ms. Leigh also explained about 'Online Money Smart Teaching Programme' which ensured equal access to resources across Australia. Ms. Leigh also briefed about 'Mixed Financial Wellbeing Network' which were national events to build capacity and strengthen networks amongst the financial capability practitioners. Ms. Leigh shared how Australian people are in control of their financial lives. She pointed out that Australian people

                a) Managed money day to day,

                b) Made informed decisions and

                c) Planned for the future.

               Among other severe factors that hindered financial inclusion, she opined that as in Nepal, geographic location inhibited financial inclusion in Australia too. Her presentation depicted the bar graph of increase in numbers of branches of Banks, numbers of ATM outlets and 'Face to Face' Big Super Days Out in Australia in the period of 10 years (2007-2017).

                In the last part, Ms. Leigh explained important 'Policies and Initiatives' being taken by Australian authorities to improve and enhance status of financial literacy, financial inclusion and financial education of general public, some of which are:

A.     Face-to-Face: Big Super Days Out

               • It is the programme which aimed to reach remote lands in central Australia (APY Lands) with industry and government                         representatives to engage with community on superannuation are done.

               • Assisted more than 500 people engage with $3 million in superannuation

B.      Online: Money Smart Teaching Programme

               • It is one of the digital initiatives targeted at the youth who are excessively active digitally.

               • It aims to provide equal access to resources across Australia.

C.        Mixed: Financial Wellbeing Network

               • It is the national events to build capacity and strengthen networks amongst the financial capability practitioners

                 The third panelist, Mr Lyndwill Clarke, Head of Department, Consumer Education, Financial Sector Conduct Authority, South Africa, presented on the topic of 'Understanding and responding to the impact of demographic changes for financial consumers'. Mr Clarke started off by giving brief presentation about South Africa. South Africa is the continent with 9 provinces and has 11 official languages. It has highest majority of black African of about 81 percent and rest of the population being white, colored and Indian/Asian as 8 percent, 9 percent and 2 percent respectively. The economic data like unemployment rate (2019) and the proportion of population living below the Lower Bound Poverty Line (2015) were quite high as 27 percent and 40 percent respectively. Mr Clarke also displayed the clear picture of trends of financial literacy in South Africa.

                 He also made a mention about the domain scores of financial literacy in his presentation and stated that financial control was 'increasing' whereas financial planning was 'decreasing'. On the other hand, product choice and product knowledge had been in 'stable state'. Thus, according to him, the overall financial literacy can be called as 'stable'. The graph of rural urban financial literacy showed that the urban formal had higher gradient over urban informal and rural resident based on many factors as race, education, employment status, age, and poverty status. Also, Mr Clarke emphasized that 'urban formal' are significant in all domain score of financial literacy than other like urban informal and rural residents

                  Mr Clarke also pointed out the objectives of Financial Sector Conduct Authority (FCSA) which were: a) to enhance and support the efficiency and integrity of financial markets; and b) to protect financial customers by:

  • promoting fair treatment of financial customers by financial institutions; and
  • providing financial customers and potential financial customers with financial education programmes, and
  • otherwise promoting financial literacy and the ability of financial customers and potential financial customers to make sound financial decisions; and assisting in maintaining financial stability.

        He also mentioned the function of FSCA was to formulate and implement strategies and programmes for financial education for the general public.

        In addition, he explained various FSCA programmes such as speech competition, mobile unit of FSCA, and other expanded public work programmes. Lastly, Mr Clarke ended by presenting various challenges South Africa was facing regarding implementing financial literacy in the country. Some of which are:

        a) Integrating financial education in school curriculum to ensure strong financial literacy content throughout the country. This was because primary and secondary schooling would take a significant amount of time to yield appreciable results in the adult population as a whole;

        b) Poverty is dynamic with individuals falling in and out of poverty based on contextual events;

        c) Unemployment creates vulnerable and disadvantaged individuals often have to make sub-optimal choices as a simple necessity, especially in the absence of a steady income or a significant economic shock.

        d) High levels of debt which creates difficulty in breaking the debt cycle

        e) Financial advice which included ensuring that the right, tailor-made advice and products are available to meet the specific situation and choices faced by individuals, families, and communities.

        The question and answer session was initiated by question from moderator Dr Lillian Koh Noi Keng to the panelist, Mr Suman Raj Aryal. Dr Keng asked Mr Aryal about the challenges Nepal faced in terms of reaching out to the rural, urban people, and underserved. In his reply, Mr Aryal pointed out three issues which posed as challenge such as knowledge of consumer, intention of the service provider, and policy itself. He further added that these issues were addressed, it would help improve present scenario of rural, urban and underserved population. One of the panelists, Ms. Leigh shared that they faced similar challenges in engaging people of those areas in their context as well. Mr Clarke replied that policy and legislations, product engagement, reaching out to people, and lack of proper implementation plans were some of the challenges they faced in their country.

       One of the participants asked Mr Clarke about the challenges they faced in one of the initiatives 'Expanded public growth programme'. Replying to this, he explained that the major challenge of the programme was that it was implemented for certain period of time. He added that among other challenges were difficulty in reaching out to people, and also it was cumbersome to constantly upgrade and facilitate the facilitator while launching the programme. He elaborated that as a regulator, they couldn't oversee project properly as it was launched all over the country. Another participant wanted to know from Ms. Leigh about Money Smart programme and her experience so far and how they were making school money smart. Ms. Leigh shared how they trained the educator and made them comfortable first, then worked towards building confidence of the teacher, and then finally trained them about the programme. She added that the money smart programme was being conducted in collaboration with state based government body.