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Banks and banking --- Financial services industry --- Intermediation (Finance) --- Financial intermediation --- Finance

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Malaysia has achieved one of the highest levels of financial inclusion among Southeast Asia countries, due in part to policies taking advantage of mobile phones and banking agents to expand access. The report looks at specific actions, programs, and strategies that have contributed to enhance financial inclusion in the country and highlights key learnings to benefit low- and middle-income countries with similar ambitions. The report also notes that there is no single factor that can explain Malaysia's success in financial inclusion. The progress that Malaysia has achieved is the result of efforts undertaken by authorities and the financial sector industry over the past 20 years. The country has been able to achieve sustainable growth of its financial system over a long period of time, reconciling two policy objectives, namely "financial stability" and "financial inclusion", in a successful manner so far. Malaysia faces two main challenges in terms of financial inclusion. First Malaysia will need to reach out to the remaining under-served population. Secondly, a major challenge is how to ensure that the people with access to financial services actually make active use of their accounts.

Access to Finance --- Finance and Financial Sector Development --- Financial Intermediation --- Financial Literacy --- Remittances

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Simultaneity of borrowing, withdrawal of savings, and loan defaults due to the pronounced seasonality of ag-riculture often leads to investment failure of rural financial institutions. Lack of borrowing leads to lack of in-come- and consumption-smoothing, and in turn, causes inefficient resource allocation by rural households. Financial institutions that are active in rural areas take different measures to address the covariate risks in in-termediation. For example, microfinance institutions have sought various measures such as supporting non-farm activities to diversify income, introducing seasonal loans, and bringing flexibility in loan repayments to reduce non-payments in lean seasons. This paper examines whether the financial inclusion policies of micro-finance institutions have successfully helped reduce the adverse effects of covariate risks. Analysis of house-hold and program level data from Bangladesh suggests that despite the innovative measures taken by the MFIs to cope with the covariate risks, seasonality of income still affects seasonality of borrowing and invest-ment decisions of both the households and MFIs beyond and above what is caused normally by agricultural seasonality. Innovation is needed to promote, among other things, sectoral diversification of financial inter-mediation and to avert the extreme seasonality of rural income. Rural labor markets should be diversified enough to address the seasonality of income and consumption. Public policies guiding rural financial inter-mediation must reflect such realities of rural economies.

Crop Cycles --- Financial Intermediation --- Investment Decisions --- Lean Seasons --- Microfinance --- Risk --- Rural Finance --- Seasonality

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The present document is the assessment of two Financial Market Infrastructures (FMI) operated by the Clearing Corporation of India (CCIL) in India - the Central Counter Party (CCP) and Trade Repository (TR); and the responsibilities of the authorities - against the Committee on Payments and Market Infrastructures (CPMI) and International Organization of Securities Commissions (IOSCO) Principles for Financial Market Infrastructures (PFMIs). The assessment was conducted through a country visit in the context of the India Financial Sector Assessment Program (FSAP) in March 2017. The information used in the assessment includes relevant laws, bye-laws, regulations, rules and procedures governing the systems, and other available material. In addition, extensive discussions were held with the Reserve Bank of India (RBI), the Securities and Exchange Board of India (SEBI), CCIL and its participants. The reports produced as part of the CPMI-IOSCO Level 1 and Level 2 implementation monitoring exercises were used for the assessment of the responsibilities of the authorities. This assessment uses the methodology presented in the CPMI-IOSCO publication - Principles for financial market infrastructures: Disclosure Framework and Assessment Methodology (December, 2012).

Finance and Financial Sector Development --- Financial Intermediation --- Financial Regulation and Supervision --- Financial Structures --- Securities Markets Policy and Regulation

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This paper proposes a framework for ex ante evaluation of sovereign disaster risk finance instruments available to governments for funding disaster losses. The framework can be used by governments to help choose between different financial instruments, or between different combinations of instruments, to achieve appropriate and financially efficient strategies to fund disaster losses, taking into account the risk of disasters, economic conditions, and political constraints. The paper discusses the framework in the context of a hypothetical country, with parameters selected to represent a disaster-prone small island state. The paper shows how a mix of instruments can be chosen to minimize the economic opportunity cost given the underlying disaster risk faced and prevailing economic and financial conditions.

Access to finance --- Debt markets --- Finance and financial sector development --- Financial intermediation --- Hazard risk management --- Urban development