UNITED NATIONS, Nov. 7 (UPI) -- World Bank Director Paul Wolfowitz is calling for inclusive finance services in developing countries to alleviate poverty.
At a forum Monday in U.N. World Headquarters in New York on expanding micro-credit, or small-scale services for poor entrepreneurs, he said, "Microfinance is a powerful tool for reducing poverty."
Wolfowitz was speaking at the opening of a three-day meeting of the International Year of Microcredit 2005. He said micro-credit "enables people to increase their incomes, to save and to manage risk. It reduces vulnerability and it allows poor households to move from everyday survival to plan for the future."
He pointed out the importance of reliable, continuing access to financial services for the poor, rather than just one-off loans. Wolfowitz said the World Bank had published a report focusing on the myriad regulations and fees hindering small businesses. The report could help governments in identifying obstacles that should be removed in providing those services.
Emphasizing that the financial infrastructure must also establish credit bureaus, delivery technologies and payment systems, he said the World Bank was advising both the public and private sectors on providing the poor with financial retail products. Although financial services were primarily a private-sector activity, governments had a critical role in setting policies and regulating the industry to minimize market distortions.
During the International Year, the World Bank and the Consultative Group to Assist the Poor are working with national committees around the world to host a series of events and conferences to highlight the importance of microfinance in the fight against poverty.