Financial institutions are subject to laws and regulations that monitor the stability of the financial system, protect customers, prevent fraud and money laundering, and ensure proper disclosure of product costs and terms. Policy makers in each country are responsible for drafting and enacting these laws and regulations, and for ensuring proper supervision exists to ensure compliance.

Beyond these essential functions, many policy makers also recognize that financial exclusion can impede economic development and contribute to financial and political instability. As such, financial inclusion is increasingly regarded as an essential component in the financial stability and integrity of an economy, and governments are highlighting financial inclusion as a national priority. Policy makers are strengthening financial laws and regulations as well as their capacity to monitor and supervise financial institutions, while also encouraging coordination and innovation to bring about greater financial inclusion.

Two workers arranging rice to be dried. Photo by Siu Ket, 2012 CGAP Photo Contest.