In recent years, financial inclusion has become a widely recognized and popularized term and has become a policy priority for many countries. While there are many ways to define financial inclusion, one of the more commonly used definitions refers to financial inclusion as individuals and businesses having equal and fair access to useful and affordable financial products and services that meet their needs (World Bank). Financial inclusion has become the forefront of development as research has shown that more equal access to fair and affordable services for the population, particularly underserved groups, can lead to greater economic growth and development. Evidence globally has shown that access to financial services achieves sustainable development and contributes to wealth creation. Moreover, financial inclusion contributes to many of the UN’s Sustainable Development Goals (SDGs) including job creation, economic growth, reduced inequalities, and poverty reduction.
As a result, central banks across the world are actively promoting financial inclusion in an effort to achieve more financial stability and equitable economic growth.
Recognizing the importance of financial inclusion, Sierra Leone’s financial inclusion journey officially started in 2009 when the Bank of Sierra Leone became a member country of the Alliance for Financial Inclusion (AFI). Since then, the Bank of Sierra Leone has taken the lead in promoting financial inclusion in Sierra Leone. This was evident when the Bank announced its commitment to the Maya Declaration in 2012, followed by a period of innovative programs that help digitalize cash payments during Ebola in 2014-2016.
Creating an enabling environment for financial inclusion
Bank of Sierra Leone is committed to and has taken the lead in driving financial inclusion in Sierra Leone. As a regulator and supervisory body, BSL plays an important role to ensure that there is an enabling environment to promote and foster financial inclusion. This is reflected through various Acts, Guidelines, Regulations, and Directives that are developed. The Bank of Sierra Leone works closely with relevant stakeholders to create these policy documents to allow for all Sierra Leoneans irrespective of their Gender, Socio-Economic status, or community to have access to, and are able to effectively use a broad range of affordable and appropriate financial products and services.
Key regulations that on enhancing financial inclusion include: Guidelines on Tiered Know-Your-Customer: this directive is intended to allow flexible account opening by reducing the requirements needed to open bank accounts, making access to financial services more inclusive for low-value low-risk accounts that are subject to a cap as the amount increases.
In 2016, BSL launched its first National Strategy for Financial Inclusion (2017 - 2020) which established the Financial Inclusion Secretariat. This national document was a roadmap for the promotion of financial inclusion in Sierra Leone. Tremendous achievements were made in during the implementation of the strategy, including:
1. Promoting financial literacy and education
2. Regulatory and policy reforms
3. Promoting FinTech Solutions
4. Promoting Digital Financial Services etc.
In April 2022, building on the successes of the first strategy and the recommendations from its evaluation, the Bank of Sierra Leone launched its second National Strategy for Financial Inclusion (NSFI 2) 2022-2026. This 5-year strategy envisions a focused approach to increase access to, enhance quality and increase usage of, financial products and services, by prioritizing strategic interventions that target women, youth, rural population, and MSMEs.
Directives on Provision of Financial Services on a Non-Discriminatory Basis: indicates that all regulated financial institutions provide services without discrimination on sex, marital status or race, and with fair and equitable conditions.
