The Monetary Authority of Singapore (MAS), in partnership with the International Finance Corporation (IFC) and the United Nations Development Program (UNDP), has launched an open financial education and action program for micro, small and medium enterprises (MSMEs) in Asia and Africa.
Known as the SME Financial Empowerment (SFE), this program aims to help MSMEs build foundational digital financial literacy skills, and gain a good understanding of cross-border financial services relevant to MSMEs, to help them thrive in the post-pandemic digital economy. The SFE was rolled out with market partners in Asia and Africa, starting with Ghana, India, the Philippines, and Singapore, and will benefit more than 400,000 MSMEs across both regions.
SFE is an inclusive and structured program run on a digital portal operated by Proxtera, which provides a global platform to link domestic SME ecosystems and catalyse cross border trade, financing, and digital services. The other key entities supporting the SFE are the United Nations Capital Development Fund (UNCDF), Singapore University of Social Sciences (SUSS) and the Global FinTech Institute (GFI). In 2022, the SFE aims to assist MSMEs in three key areas – essential financial digital skillset, MSME financial services, and digital economy access and growth. The first tranche of the program will comprise two learning modules focused on essential financial digital skillsets –
(a) Foundational financial literacy which covers basic financial concepts and financial products essential for MSMEs.
(b) Global financial literacy which equips MSMEs with knowledge to connect to the digital economy and expand internationally by leveraging networks, financial services, fintech solutions and digital tools.
Further learning modules will be released in future tranches. Upon completion of each module, businesses will receive a digitally verifiable certificate issued by SUSS and GFI, that grants access to financial services tools and knowledge services through a resource hub.
The SFE learning modules incorporate best practices on key financial literacy and financing topics, benefitting from the program sponsors, Ant Group, Digital Pilipinas, Globe Telecom, Validus and Visa as well as from a broader ecosystem of community partners including Bolttech, Coface, Consolidated Bank of Ghana, Development Bank Ghanaand Philippines Department of Trade and Industry Philippine Trade Training Center.
The SFE builds on an earlier MOU between MAS and IFC on the Financial Trust Corridor (FTC) initiative to drive wider financial knowledge sharing, financial trust building and financial inclusion for MSMEs and financial institutions in developing markets. The FTC comprises a multi-party cross-border governance framework and trusted closed loop digital infrastructure, which governments and financial institutions from different countries can utilize to share verified information on foreign business counterparties and their financial supporting institutions. This information will help businesses involved in cross-border trade obtain easier access to financing.
Sopnendu Mohanty, chief fintech officer of MAS, said, “An empowered MSME is essential to an equitable and sustainable digital economy. Such enablement begins with digital economy literacy. The affordable, bite-sized learning program provided by SFE is a collaborative effort involving financial institutions, and public and private sectors. Through the foundational and global financial literacy modules, MSMEs in Asia and Africa will benefit from new skills to leverage networks, financial and digital tools to grow their business internationally.”
Qamar Saleem, regional industry manager, financial institutions group advisory services, Asia and Pacific at IFC, shared, “We are delighted to partner with MAS and UNDP for this impactful initiative, which has the potential to improve the livelihoods of thousands of small business owners in emerging markets. Empowering MSMEs with financial literacy and digital skillsets will help to level the playing field for smaller businesses, ultimately helping to address financing gaps and improving financial inclusion. Our team in Singapore will also play a vital role in maximizing the impact of this program through its extensive knowledge and decades of experience in implementing best practice and strengthening the processes and resources of MSMEs in emerging markets around the world. We look forward to leveraging our expertise to build a better future for MSMEs in Asia and Africa.”
Marcos neto, director of the finance sector hub at UNDP, highlighted that: “In every country in the world, SMEs play a central part in the economy and society – and they are also the backbone of the global economy. SMEs represent up to 90 per cent of the business segment in many countries – and also up to 80 per cent of employment. But, too often, the potential of SMEs is constrained by gaps in knowledge relating to digital processes and technologies. Helping SMEs to participate in the digital economy, through relevant training and digital financial skills, can unlock productive and sustainable growth. This knowledge is a real catalyst, and an important reason as to why UNDP is delighted to collaborate with IFC and the Monetary Authority of Singapore in this important initiative. These efforts also align with UNDP’s global work that puts strong emphasis on sustainable SME growth, and aims to mobilise increased and more sustainable finance for SMEs.”