Dhaka, Bangladesh (BBN)- Bangladesh Bank (BB) Governor Dr. Atiur Rahman has urged the SAARCFINANCE member central banks to work closely for achieving sustainable economic growth through strengthening financial inclusion initiatives.
“We SAARCFINANCE member central banks can work closer together to steal a march on our advanced economy counterparts in better sustaining our growth and stability over the longer term,” the BB governor said while inaugurating SAARCFINANCE Governors’ Symposium at a city hotel Friday morning.
The central bank chief also said governments and central banks and financial sector authorities in all SAARCFINANCE member countries are employing financial inclusion as a tool for promoting social inclusion and social empowerment of the underprivileged population segments; with evident gains in terms of faster human development and retreat of poverty.
“Besides, promotion of inclusive financing for MSME output initiatives of these underprivileged population segments have yielded important gains in domestic demand driven output and employment in the SAARCFINANCE member countries, largely compensating for weakness in export led growth due to prolonged demand slack in advanced economies since the global financial crisis,” BB Governor Dr. Rahman explained.
He also said: “We can perhaps combine efforts in engaging think tanks of our region in systematic impact evaluation of the various financial inclusion approaches based on cross country data, as also in establishing firm theoretical underpinnings for our initiatives by clearly identifying the feedback paths linking the inclusion initiatives with output growth, employment growth, and macro-financial stability outcomes.”
Establishing of such linkages will put paid to skepticisms still prevailing in central banking orthodoxies in advanced economies about appropriateness of developmental role of central banking, the governor added.
The SAARCFINANCE Governors’ Symposium, organised by the central bank of Bangladesh as a part of achieving one of the broad objectives of SAARCFIANCE to forge closer cooperation on macro-economic policies of SAARC member countries and to share experiences and ideas.
Financial inclusion or inclusive financing encompasses the range, quality, and availability of financial services to the underserved and the financially excluded population of a country, according to SK Sur Chowdhury, deputy governor of the BB.
“It is the delivery of financial services at affordable costs to sections of disadvantaged and low-income segments of the society. One essential element of financial inclusion is access to instruments that allows for saving or borrowing or both. Therefore, credit to micro, small and medium enterprises along with national saving schemes for low and middle income people are essential for the development of the financial sector,” Mr. Sur Chowdhury noted.
Lakshmanan Savithri, director of SAARC secretariat, requested the SAARCFINANCE to discuss genuine integration so that free movement of capital is facilitated and inter-regional investment and remittance are hassle free within the region.
She also said the region is also likely to benefit from Asian Infrastructure Investment Bank and BRICS Bank would require financial linkages with them and others IFIs (international financial institutions) on a regional basis for cross border projects.
“The SAWAP arrangement offered by India has used only by Bhutan. We need to discuss how other member states can use this facility also,” Ms Savithri noted.
Dasho Daw Tenzin, Governor of the Royal Monetary Authority of Bhutan also spoke on the occasion.
BBN/SSR/AD