WAY FORWARD

An analysis of the strengths, weaknesses, opportunities and threats for the financial inclusion of FDPs in Afghanistan illustrates the multiple dynamics to be considered by national financial inclusion stakeholders. The lack of trust in financial institutions among broad segments of the Afghan population – including FDPs – shows the importance of implementing measures to enhance consumer protection and financial literacy. Similarly, further work on public education on Islamic banking and Sharia-compliant financial products will be imperative in overcoming reluctance in the use formal financial services by FDPs. The challenge in women’s access to formal financial services, including the gendered issue of access to identification documents faced by women FDPs requires continued attention from DAB and financial inclusion

stakeholders to address the role of socio-cultural norms197 and having gender at the heart of the NFIS implementation.198

197

198 CGAP. 2017. Social norms change for women’s financial inclusion. Available at: https://www.cgap.org/research/publication/socialnorms-change-womens-financial-inclusion Alliance for Financial Inclusion (AFI). 2017. Integrating gender and women’s financial inclusion into national strategies. Available at: https://www.afi-global.org/publications/2484/Guideline-Note-27Integrating-Gender-and-Women-s-Financial-Inclusion-into-NationalStrategies

FIGURE 6. AFGHANISTAN’S STRENGTHS, WEAKNESSES, OPPORTUNITIES AND THREATS (SWOT) FOR THE FINANCIAL INCLUSION OF FDPs

STRENGTHS

Strong political acceptance and will from DAB and other government stakeholder on FI Existing advocacy channels that can target multiple levels of beneficiaries at government down to individual level Programme builds upon existing FDP initiatives from government and implementing partners

OPPORTUNITIES

Expanding mobile banking and e-money initiatives such as m-pasa Expanding electronic and virtual initiatives including e-tazkera

Governance structures including Citizens’ Charter that can link FDPs with FI initiatives at the local level Large scale remittance flows from Afghan migrants in Iran, Pakistan and turkey Increasing uptake of cash transfers in displacement programming Partner IGOs and NGOs including NRC, Mercy Corps and ICRC that have previously worked with AFI Potential to further develop Islamic banking and Shariaspecific financial services

WEAKNESSES

Low levels of income and insufficient funds to drive formal finance uptake; Expresses skepticism of financial institutions by FDPs and the broader population alike because of historical scandals (i.e. the Kabul Bank collapse)

Complex and fast-changing political environment with disputes in government and ongoing civil conflict Issues of corruption in Afghanistan and in finances Human and financial resource constraints hinder ability to capacitate all implementing partners Inhibiting cultural view on gender often preclude women from accessing services, including FI

THREATS

Ongoing and impending threats to governance at all levels, from national disputes to local level issues in security and governance

Lack and further loss of access for FI initiatives stemming from government Economic insecurity, low spending on FI Poor infrastructure, both physical and virtual inhibit expansion of FI Potential financial constraints due to banking and financial flows involving Iran Direct and spillover ramifications from COVID-19, hampering implementation of the NFIS