US$5M for Pacific financial services

Transcript

The United Nations has launched a new project to help low-income and rural Pacific Islanders access affordable savings, insurance, credit and other financial services.

It estimates in some Pacific countries, less than 10 percent of adults have access to banking.

As part of the Pacific Financial Inclusion Programme, the project, called the Financial Inclusion Support Facility, will allow for US$5m in grants to be dispersed to small businesses and the region's poorest.

The UNDP administrator, Helen Clark, told Mary Baines it will mean more people can start small businesses, insure against losses and save in case of illness or disaster.

HELEN CLARK: There's a support facility of US$5m which is going to be available for companies and other financial service providers to apply to to develop new products which will bring more financial services and innovation to the Pacific and other regions. So, it's exciting because there is a large unserviced population here in the Pacific and we have to find new and innovative ways of reaching it. So we're hoping that the private sector will come to the party, they will put in some cash themselves and help develop new products.

MARY BAINES: So what will the social implications of this be for the Pacific?

HC: It's very, very positive when people can get access to credit, to a secure bank account, to insurance for risk whatever. Part of getting out of poverty is being able to have financial services but often the depth of the poverty stops the access to the financial services - you're getting a cycle you can't get out of - that's why an initiative like this is catalytical; it brings in the private sector, it gets them to help devise the solution which will help lift people and their micro-businesses into being a small business, and create a virtuous cycle.

MB: So what do you think this SIDS can achieve this week? There's lots of talk that conferences like this; the promises are made, the agreements are made, but implementing them long term is a different story.

HC: Well there's three critical things about the conference. The first is [that] Samoa early on identifed the theme of partnerships - building strong partnerships for development at SIDS, and that's demonstrated by the kind of partnership that we have around the Pacific Financial Inclusion Programme of UNDP [United Nations Development Programme] where Australia, New Zealand, the European Commission, the central bank governors of the developing countries work together to support something that will support movement out of poverty. Secondly and thirdly, this conference is critically timed prior to the major climate conferences and the finalisation of the post-2015 development agenda, and that means it's a chance for the Pacific voice and other Caribbean and Indian Ocean and small island voices to be heard very, very loud and clear. So it's all about advocacy as to what will support small island developing states to really move ahead in global development.

The new facility is funded by New Zealand, Australia and the European Union.