Financial Crime World

Georgia’s Financial Inclusion Efforts Face New Challenge as Crime Soars

Tbilisi, May 24, 2019 - The European Union has launched a €4.5 million project aimed at improving financial inclusion and accountability in Georgia, but experts warn that the initiative may be hindered by rising crime rates in the country.

The Georgia Financial Inclusion and Accountability (FIA) Project

Implemented by the World Bank, the FIA project aims to:

  • Support private sector development
  • Boost small and medium-sized enterprises (SMEs)
  • Enhance productivity
  • Foster financial sector soundness
  • Improve financial inclusion for underserved clients
  • Build foundations for more competitive, transparent, and well-governed institutions

Rising Crime Rates: A Threat to Financial Inclusion

However, concerns are growing about the impact of crime on Georgia’s financial inclusion efforts. According to recent statistics, crime rates in the country have surged, with instances of fraud, theft, and extortion becoming increasingly common. This has led to a sense of unease among businesses and individuals, who are hesitant to engage in financial transactions due to fear of being targeted by criminals.

Expert Insights

“We expect the project to support the Government of Georgia in the design and implementation of reforms that foster financial sector soundness, improve financial inclusion for underserved clients, and build foundations for more competitive, transparent, and well-governed institutions,” said Mercy Tembon, World Bank Regional Director for the South Caucasus.

“However, we must also acknowledge the challenge posed by rising crime rates in Georgia and work with the authorities to address this issue.”

Project Implementation

The project is being implemented in close cooperation with:

  • National Bank of Georgia
  • Ministry of Economy and Sustainable Development
  • Ministry of Finance
  • Insurance State Supervision Service of Georgia
  • State Service for Accounting, Reporting and Auditing Supervision
  • Other private and public stakeholders

Optimism Amidst Challenges

Despite the challenges posed by crime, officials are optimistic about the potential impact of the project.

“The launch of this project is a critical step initiated by the European Union in order to boost private sector development in Georgia,” said Vincent Rey, Head of Cooperation of the European Union Delegation to Georgia. “We expect visible improvements in access to finance and investment climate.”

Project Details

  • The €4.5 million project will be implemented over four years, from 2019 to 2022.
  • It is part of the World Bank Group’s support to Georgia under the Country Partnership Framework for 2019-2022 and the EU’s Single Support Framework 2017-2020 for Georgia.