This paper assesses the current state of financial inclusion in the Middle East and North Africa (MENA) region. It identifies constraints, opportunities and priorities for improving financial access in the region.
The paper provides an overview of the structure, performance and characteristics of the microfinance sector in MENA. It studies the framework for financial inclusion, and examines regulations, financial infrastructure and government policies and programs. The paper states that financial inclusion is a policy focus for several MENA countries. Enabling environment for financial inclusion in the region is weak, but has improved in recent years.
The paper presents recommendations for stimulating private sector investment in microenterprises, removing barriers to financial inclusion and encouraging product diversification and risk management. The measures suggested include:
Developing a financial inclusion strategy backed by data, resources and commitment;
Providing regulatory and supervisory framework that is based on risk management and includes consumer protection;
Strengthening financial infrastructure for inclusion;
Ensuring level playing field for Islamic microfinance.