Glossary
GLOSSARY
This glossary provides definitions of key terms used in various sections of the ADP. The glossary is divided into three parts corresponding to three distinct datasets.
(i) MAYA DECLARATION COMMITMENTS
Concrete Target
Under the Maya Declaration, concrete targets are specific steps or goals that institutions pledge to achieve to further their financial inclusion objectives.
Completion Status
A given concrete target under the Maya Declaration has a completion status of either "In progress" or "Completed".
- "Completed" means that a target in question has already been achieved.
- "In-progress" means that a target is still ongoing and has not been achieved.
Through the ADP, members are expected to regularly report progress towards achieving their commitments, including confirming completion status of their targets.
Submission Date
Refers to the date when a particular concrete target is pledged under the Maya Declaration.
Expected Completion Date
Refers to particular month and/or year when a particular target is expected to be achieved. For example, the expected completion date for a target of "Issue a new e-money regulation by 2015" could be "2015".
Type of Target
There are two types of targets under the Maya Declaration: Qualitative Targets and Quantitative Targets. The main difference between quantitative and qualitative targets is that the former come with numeric objectives. For example, “Ensuring that 80% of the adult population have bank accounts by 2018” is considered a quantitative target, whereas “Issue a new e-money regulation by 2015” is considered a qualitative target.
Progress last reported date
Refers to the date on which the member last reported progress on the target
(ii) INDICATORS
Dimension
A financial inclusion indicator typically measures one of the three dimensions of financial inclusion: Access, Usage, and Quality.
Access
One of the dimensions of financial inclusion. Access dimension refers to the ability to use the services and products offered by formal financial institutions. Data on access can usually be obtained through information provided by financial institutions.
Usage
One of the dimensions of financial inclusion. Usage dimension refers to the depth or extent of financial services and product use. Determining usage requires gathering details about the regularity, frequency and duration of use over time.
Quality
One of the dimensions of financial inclusion. Quality dimension refers to the relevance of the financial services or product to the needs of the consumers. Quality dimension can include aspects of affordability, convenience, consumer protection, and transparency.
Source
Data to compute financial inclusion indicators are typically collected from two types of sources: demand side and supply side. Demand-side source refers to data collected from financial consumers such as household survey data. Supply-side source refers to data collected from financial services providers.
(iii) POLICY PROFILE
Policy Profile
Repository of knowledge on the legal and/or regulatory status of financial inclusion. Each policy profile allows user to examine the regulatory framework of different policy / thematic area.
Country Profile
Allows user to examine the regulatory frameworks of each country as per each policy profile with additional details and explanation.
Last Update Date
Refers to the month/year when a response is last updated for a particular question. A response may be updated by AFI or the members on some occasions due to error in initial response or due to changes in policies & regulations. Last Update Date can vary across countries and questions.
Explanation
Provide explanation and/or evidence to support a response to each of the question in the Policy Profile survey.
Glossary of Terms used in the Policy Profile
| Term | Definition |
|---|---|
| Access | Ability to use the services and products offered by formal financial institutions. |
| AFI Core Set | The Core Set of Financial Inclusion Indicators (“the Core Set”) is a set of quantitative indicators that capture the state of financial inclusion in a country. |
| AFI SME Finance Base Set Indicators | A set of indicators designed by AFI that provide a reasonably comprehensive view of the state of financial inclusion for SMEs in a given country. The Base Set comprises 12 indicators. |
| Agent(s) | Any third party acting on behalf of a Bank, Non-Bank or other Financial Service Provider (including an E-money issuer or distributor) to deal directly with customers. The term ‘agent’ is commonly used even if a principal agent relationship does not exist under the law of the country in question. |
| AML regime | Anti-money laundering legal and regulatory framework in each country. |
| Assessors | An assessment team representing Standard-Setting Bodies or third parties tasked to evaluate country’s level of compliance with global standards. These include FATF standards and Basel standards. |
| Bank | Any Financial Service Provider licensed to act as a “bank” in accordance to the general definition set forth in the current law given in each country. |
| Basel Framework | A framework for reform measures developed by the Basel Committee on Banking Supervision (BCBS) to strengthen the regulation, supervision, and risk management of a banking sector. |
| Building Society | Financial institution owned by its members as a mutual organization. Building societies offer banking and related financial services, especially mortgage lending. |
| CDD | Customer Due Diligence, a practice to identify a potential customer (Know-your-customer). |
| CFT regime | Countering the finance of terrorism legal and regulatory framework. |
| Common Trust Fund | A fund which is managed by a bank or trust company and in which the assets of many small trusts are handled as a single portfolio with individual beneficiaries receiving returns proportionate to their share of the principal |
| Credit Bureaus | Agencies and companies that collect information on credit ratings of individuals or companies |
| Credit registries | Databases that record individual credit information on borrowers. Credit registries tend to be publicly owned. |
| Crowdfunding | A practice of funding a project or venture by raising financial contribution from large number of people, usually via internet-based platform |
| DFS | Digital financial services (which include mobile financial services) are financial services provided by electronic devices or channels (prepaid cards, mobiles financial services). |
| Demand-side data | Any data that is collected from the consumers or end users of financial services, as opposed to suppliers. Consumers can include individuals, households, or businesses. Examples of demand-side data include data from a household survey. |
| Development financial institutions | Specialized development banks or subsidiaries set up to support private sector development in developing countries. They are usually majority-owned by national governments and source their capital from national or international development funds or benefit from government guarantees. |
| Electronic account | An E-money holder’s account that is held with the E-money issuer. |
| Electronic money or E-money | A type of monetary value electronically recorded and generally understood to have the following attributes: (i) issued upon receipt of funds in an amount no lesser in value than the value of the E-money issued; (ii) stored on an electronic device (e.g. a chip, prepaid card, mobile phone, or computer system); (iii) accepted as a means of payment by parties other than the issuer; and (iv) convertible into cash. |
| E-money issuer | An entity that initially issues E-money against receipt of funds. This could be either a Bank or a Non-bank. |
| FATF | Financial Action Task Force, an inter-governmental body developing and promoting policies to combat money laundering and terrorist financing. |
| FATF risk assessment | An evaluation conducted to measure compliance with FATF standards. It analyses all aspects of the frame adopted in a country to tackle money laundering and the financing of terrorism. |
| Financial Capability | Positive behaviors that constitute sound financial decisions. This is closely related to the notion of Financial Literacy (see below). However, the capability dimension measures behaviors as opposed to knowledge. |
| Financial Literacy | Degree of knowledge and skills needed to make sound financial decisions |
| Financial Regulator | Governmental Institution, such as the central bank, that is responsible for regulating financial services (i.e. central banks, superintendencies). |
| Financial Service Providers | Entities licensed to provide financial services in a given country (e.g. Banks, Non-banks, SACCOS, MFIs, etc.) |
| FSRB | FATF style regional bodies. |
| Global FINDEX | The Global Financial Inclusion Database (Global Index) is the first public database of indicators that consistently measure people’s use of financial products across economies and over time on a regular basis. |
| Governmental Institution | Institution, agency, authority or any other entity of your country’s federal government, including an AFI member if applicable. |
| GPS | Global Positioning System. |
| Internal Ratings-Based (IRB) | approach An approach whereby banks are allowed to develop their own models to quantify credit risks or the purpose of setting regulatory capital. |
| Law Firm | A legal firm engaged by AFI to prepare responses to the AFI Country Policy Profile’s questionnaire. |
| MFI | Microfinance institutions primarily focused on providing financial credit services to serving low-income populations or to small and/or medium enterprises. |
| MFS | Mobile financial services, a subset of DFS that imply the use of a mobile phone device to access financial services and execute financial transactions. |
| Micro-insurance | Insurance services and products targeted for low-income individuals. |
| Mobile Money | A mobile-based transactional service that can be transferred electronically using mobile networks. A mobile money issuer may, depending on local law and the business model, be a Mobile Network Operator (MNO) or a third party such as a bank. Often used synonymously with mobile financial services |
| Mobile Wallet | An E-money account held on a mobile phone. |
| MOU | Memorandum of Understanding. |
| MSME | Micro, Small, and Medium Enterprises |
| Mutual Evaluation | Evaluation conducted to measure compliance with FATF standards. |
| Non-bank | A Financial Service Provider different from a Bank (as defined above) permitted by the Financial Regulator to provide financial services (e.g. Non-bank E-money issuer). |
| Non-bank | credit Includes credit by credit unions, credit cooperatives, SACCOs, building societies, savings and thrift societies. |
| Leasing Companies | Companies engaged in financing a purchase of tangible assets. The leasing company is the legal owner of the goods. |
| Pawnbrokers | Any individuals or businesses (pawn shop) that offered secured loans to consumers with their personal items used as collaterals. |
| Peer-to-Peer (P2P) lending | A practice of lending moneys to individuals or businesses through online services matching borrowers directly with lenders. P2P lending is one type of crowdfunding (see definition above). |
| Pension fund | Any plans, funds, or schemes that provide retirement income |
| Proportionate Regulation | Regulation that is issued according to a risk based approach that balances risks and benefits against the costs of the regulation and supervision. E.g.: Increasingly, regulators are designing tiered regulatory parameters and CDD controls for products with different risk levels. In general, the lower the risk, the lower the CDD requirements. |
| Provident fund | Similar to Pension fund (see definition above) |
| Regulation | Includes legislations, regulations, guidelines and rules. |
| Retail credit | Retail credit institutions include leasing, finance companies, and retail department store credit providers, pawnshops, etc. |
| SACCO | Savings and Credit Co-operative. |
| Securitisation entities | Any entities that pool together certain types of financial assets, repackage them into a new type of securities, and sell them to investors |
| SME | Small & Medium Enterprises. |
| Superannuation | Regular payment made into a fund by an employee toward a future pension. |
| Supply-side data | Any data that is collected from financial services providers, as opposed to consumers or end-users of those services. |
| Thrift Society | A voluntary association that promotes thrift and the collective investment of the savings of the members. |
| Usage | The act of employing or utilizing a financial service |