This forum brings together some of the best minds from different parts of the world with diverse experiences in the field of financial inclusion. I am certain that this forum will enhance our understanding of the vital issues confronting the financial inclusion agenda, and will contribute towards the formulation of new ideas in addressing the important issue of regulation and policy that will ensure the sustainability of an inclusive financial system. The financial crisis and its implications on the poor The year 2009 will likely to be a difficult year for most countries. As we enter the third year of this financial crisis, there is already a synchronised recession in the advanced economies. For most of the emerging economies however, the full effects of the crisis on their domestic economies will be felt this year. It is important to note that the financial systems in most emerging economies continue to remain sound and more importantly continue to function, providing credit and supporting the economy. The collapse of external demand has however, adversely affected the more open emerging economies. The issue of equal concern however, is the more disproportionate impact these developments will have on the poorer economies. Similarly, the disproportionate effect these developments are having on the poorer segments within a particular economy. This crisis thus brings to the forefront a number of issues concerning financial inclusion.
These include increasing the public awareness on the importance of financial inclusion, assisting governments in the design of regulatory systems that facilitate the creation of financial services for the poor, encouraging the of use of holistic measures to gauge the progress of financial inclusion, collecting and disseminating best practices, collaborating with the private sector to leverage on the talent and technology to further advance financial inclusion and to promote research that will galvanise new initiatives. In Malaysia, financial inclusion is a high priority in our national agenda. Since the establishment of the Central Bank, there has been a conscious policy to have an extensive commercial banking branch network across the country, to ensure the outreach, in particular, to cover the non-urban areas. Malaysia now has 10.2 branches for every 100,000 individuals as opposed to the global median of 8.4 branches for every 100,000 individuals. In Malaysia, more than 80% of the population also have some form of savings account. This has also contributed to the financialisation of savings in the country. Deposits as a percentage of gross domestic product is 180%. This means that savings is mobilised including from small savers into the formal financial system. This allows the savings to be channelled to productive economic activity. To further drive the provision of basic financial services to the underserved, the National Savings Bank in Malaysia has been mandated to enhance the outreach of deposit services and micro-financing.