In a recent discussion on boosting public-private sector dialogue for financial inclusion, Sarah Corley, President of the Alliance of Digital Finance and Fintech Associations (ADFFA), remarked, "what digital financial services associations can do, the role they can play in the ecosystem is absolutely phenomenal if they are well-resourced."

Other speakers in the discussion, co-hosted by the European Union (EU), the Organization of African, Caribbean and Pacific States (OACPS) and the United Nations Capital Development Fund-UNCDF, buttressed her point, emphasizing the critical role that digital financial services associations play. Beyond information sharing, relationship building and collaboration, DFS associations are a platform for stakeholders to lobby for policy changes and regulatory improvements.

Touching on the importance of public-private sector dialogue to improve digital financial inclusion and how the EU supports it, Nicolas Fichers, Director General for International Partnership, EU, overseeing the Digital Finance for Resilience (DFS4Resilience) Programme, added, "We support partner countries to improve digital financial inclusion, especially for specific targets like the poor. We recently conducted a study to identify gaps and inform our ongoing efforts. Digital financial inclusion isn't just about access. It's about building an ecosystem that works for everyone. We need a supportive regulatory framework, innovative new products like digitized university fees, and programmes that empower people to use these services effectively."

Bringing together different actors to improve the regulatory framework and deliver innovative products is essential. UNCDF, in its market convenor role, has a track record of fostering financial inclusion through DFS working groups. The digital finance programme implemented in Benin between 2015 and 2019 is a prime example. Partnering with the MasterCard Foundation, the programme leveraged a DFS working group to catalyze various actors' initiatives around a common goal. This collaboration contributed to building a digital payment ecosystem, with DFS adoption leapfrogging from 2 percent in 2015 to 40 percent by 2019.

Similarly, the DFS Associations in Malawi and Ethiopia, convened by UNCDF under the DFS4Resilience programme in partnership with the EU and OACPS, are contributing to increasing access to financial services and empower underserved communities. The essential work of these associations underscores their need to grow and thrive. However, many associations, including those in Ethiopia and Malawi, struggle with funding and long-term viability. "One of the main challenges is sustainability. Because we are a programme, intrinsically, that means there is an end to a programme, and that means an end to the support of this kind of association", explained Bram Peters, Programme Manager for the DFS4Reilience initiative.

The discussion highlighted the need for digital financial services associations to create diverse revenue streams as a key solution to their sustainability challenges. Sarah Corley stressed this point, citing examples of viable options such as membership fees, revenue generation through research, consultancy and advocacy, and continued partnerships with development organizations. She also emphasized that financial resources alone are not enough, as associations need to demonstrate their value and impact to attract funding and build trust with stakeholders. This could involve showcasing success stories, conducting research on the impact of digital finance initiatives, or developing advocacy campaigns for policy changes.

In response to a question on the sustainability model that the Malawi Association would adopt, William Kaunda, Chair of the association, said, "Our goal is to provide enough value to members before introducing fees. We're exploring diverse funding options; our priority is maintaining transparency and effective governance, demonstrating our trustworthiness to stakeholders in managing funds effectively."

The importance of ongoing knowledge-sharing and capacity-building efforts within digital financial services associations was highlighted as a crucial sustainability measure. Cross-learning between countries, facilitated by exchange visits (such as the one embarked on by the Ethiopia DFS Association to Ghana last year) and collaborative platforms, were identified as efficient and resilient ways to tackle shared challenges.

Overall, the session underlined the critical role of well-resourced digital financial services associations in promoting financial inclusion, especially for underserved constituents. Watch here to learn more about how the association in Malawi played a key role in the National Switch or how the association in Benin contributed to establish the first bank to wallet product between a microfinance institution and a mobile operator: InfoPoint conference: Promoting Public and Private Sector Dialogue for Digital Financial Inclusion - Streaming Service of the European Commission (europa.eu)