Interview: Abdellatif Jouahri
What is being done to boost financial inclusion?
ABDELLATIF JOUAHRI: Despite actions taken over the last 10 years, both rural and urban areas show significant disparities between genders, and between adults and young people. Considering these challenges, we have developed a national financial inclusion strategy in partnership with the Ministry of Economy and Finance, and with stakeholders in the financial ecosystem. The objective is to coordinate the players’ initiatives; develop effective policies aligned with the sector’s guidelines; and define the priorities and roles of stakeholders.
The strategy puts forth three major goals. The first goal is to achieve a decent level of financial penetration and services for all citizens. Broader financial inclusion can be reached by providing universal access to bank accounts. It also proposes a push to convert informal savings into formal savings, as well as widening the spectrum of financial solutions. This is an approach that will help reach the smallest businesses and households, and give better access to insurance solutions that cover the most important risks. The second goal is to reduce significant gaps in financial inclusion through education, affordable and easyto-use financial solutions, and greater proximity to services. Lastly, it aims to take advantage of financial inclusion in order to achieve the best possible overall economic and social integration.
How has Islamic finance been developing?
JOUAHRI: Since launching in early 2017 participatory banks and windows have opened nearly 47,500 bank accounts, processed a total of $1.2bn deposits, and granted nearly Dh4.5bn ($404.7m) worth of murabaha (cost-plus financing), mostly dedicated to real estate. Financing activities, which are predominantly focused on individuals, are expected to be extended to the corporate segment in 2019. This will take place after establishing standard contracts for the financing of investment and operating cycles, and after the collection of investment deposits have all been finalised. With the gradual completion of a contractual framework for banking products, participatory finance should continue to develop well into the future, and is expected to accelerate alongside increases in the finance network and the use of digital platforms. After this initial step, participatory finance will be ready to begin a new phase, with the launch of takaful (Islamic insurance) and sharia-compliant capital markets.
How is the sector fighting against financial crimes?
JOUAHRI: To combat threats against the sector, BAM has created a service dedicated to the control of financial integrity. The bank’s risk assessment system places oversight of the banking sector’s financial integrity at the centre of its priorities. The system allows adjustments to the frequency and intensity of oversight according to the risk profile of the establishment, and also carries out on-site and remote checks, which have significantly increased in recent years. At the same time, we have adopted a policy of supporting credit institutions with an awareness-raising approach while maintaining the evolution of prudential norms.
On a cross-border basis, Moroccan banking groups are required to be present outside the national territory – particularly in sub-Saharan Africa – and to understand that the rules established in terms of governance, risk management, internal control and due diligence apply on both individual and consolidated bases. To this end, BAM entered into cooperation agreements with authorities in host countries, instituting colleges of supervisors for banking groups to support cross-border supervision. These agreements allow joint on-the-spot checks between BAM and host country regulators, which are carried out by various bank subsidiaries or bank branches operating internationally. They also ease the exchange of information, particularly in regards to the ongoing fight against money laundering and the financing of terrorism.
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