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Financial Inclusion and Financial Crime in Timor-Leste: A Call to Action

Progress towards Financial Inclusion

A recent report by the Banco Central de Timor-Leste (BCTL) has revealed significant progress made in Timor-Leste’s journey towards financial inclusion over the past two years. The report emphasizes the importance of understanding market dynamics and client needs, highlighting that people won’t use digital services if they don’t understand how to or the benefits they provide.

Personal Experience with Financial Inclusion

As a resident coordinator for the UN in Timor-Leste, I have seen firsthand the transformative power of financial inclusion. My mother’s story, which dates back to the 1960s when we migrated from Kenya to the UK, is a testament to this. Despite her limited English skills and lack of formal education, she was able to find employment and open a separate bank account, taking control of our family’s finances. This decision led to significant changes in our economic situation and shaped my personal commitment to financial inclusion.

Key Facts for Accelerating Financial Inclusion

The report highlights several key facts that can be used by stakeholders to accelerate financial inclusion in the country:

  • Significant improvements in access points, with increased coverage in Sucos and all Administrative Posts now covered by at least one type of financial service access point.
  • E-wallet services have seen impressive growth, with over 3,000 agents and 86,000 registered clients in 2020.

The Need for Financial Literacy

However, despite these advances, the report also highlights the need for improved financial literacy in Timor-Leste. The findings show that while 64% of adults have an account with a formal financial institution, many are unable to access these services due to a lack of awareness and knowledge. This emphasizes the importance of digital and financial literacy and customer awareness on products, services, and eligibility criteria.

Collective Responsibility

The promotion of financial inclusion is a collective responsibility, requiring the government, private sector, development partners, and civil society to work together. The UN family, including agencies such as the UN Capital Development Fund, stands ready to support the Government and Central Bank of Timor-Leste in achieving their vision for an inclusive financial system that brings benefits to all.

A Call to Action

As families struggle to rebuild their lives post-COVID-19 and recent floods, good financial services are vital part of national efforts to “build back better.” The Timor-Leste Financial Inclusion Report 2020 is a call to action, urging stakeholders to work together to accelerate access to financial services in the country. With this report, we hope to unleash the transformational power of financial inclusion and improve the lives of the Timorese people.