Circular dated April 6, 2017 regarding the Arab Financial Inclusion Week

Cairo on: 6 April 2017

Dear Mr. Chairman of the Board,

Greetings,

In light of the efforts made to consolidate the principle of financial inclusion, and what it included of establishing a central department at the Central Bank of Egypt aimed at improving the level of financial inclusion in Egypt, which requires the participation and support of all banks in the banking sector, especially regarding data collection.

With reference to the meeting held on 19 March 2017 at the Bank's headquarters with bank officials on the date designated by the Central Bank as "Arab Financial Inclusion Day" on 27 April of each year, and discussing proposals from bank officials for activities that can be implemented during this day to unify activities.

We provide below the proposed activities to be held by banks starting from the Arab Financial Inclusion Day on 27 April 2017 for a period of one week:

1. Banks are allowed to be present outside their branches (such as remote and marginalized areas, different regions of Egypt, clubs, universities, etc.) during the mentioned week and present suitable banking products for this segment of customers according to the following conditions: a. Informing the Banking Affairs Department - under the Supervision and Control Sector - of the locations of presence in advance. b. Opening accounts for new customers without fees and without a minimum opening limit under the slogan (An Account for Every Citizen) at the locations of presence, with the Bank notifying the Central Bank of the number of accounts opened during the mentioned period. c. Adhering to the rules prescribed for conducting marketing activities for banking products according to the letter of the Deputy Governor dated 19 April 2016 after the end of the mentioned period.

2. Publishing the promotional material "Banner" containing the slogans of the Arab Financial Inclusion Week and the Central Bank on all bank branches, noting that the file will be sent to you via email. (Image attached).

3. Printing the two informational brochures specific to financial inclusion and distributing them to the public and employees in the financial sector (Initial draft file attached for printing), noting that you will be notified later.

4. Providing media coverage for the event and advertising for the activities through each bank.

5. Sending informational SMS messages to telecommunications company customers to introduce the event and advertise that banks are opening accounts for customers without fees, to start one week before the Arab Financial Inclusion Day for a period of two weeks.

Please be so kind as to alert regarding taking the necessary measures for the preparation of the activities of the Arab Financial Inclusion Week and documenting them, and informing us of the results of those activities, with giving the matter your special attention.

Accept our highest respect,

Gamal Naguib

Financial Inclusion Informational Brochure for the General Public

What does financial inclusion mean? Financial inclusion is that every individual or institution in society receives suitable financial products for their needs, such as:

• Savings accounts
• Current accounts
• Payment and transfer services
• Insurance
• Financing and credit
• And other different financial products and services

These products must be provided through legal channels, such as banks, the postal authority, non-governmental organizations, etc., and their prices must be suitable for everyone, easy to obtain, and respect consumer rights.

All of this is to ensure that all segments of society have appropriate opportunities to manage their money and savings properly and safely to ensure that the majority do not resort to informal means that are not subject to any supervision or control, which may expose them to fraud or impose excessive fees.

What is the importance of financial inclusion and its goals? Financial inclusion is a main cause of economic growth for the state and financial stability... How? Because the economic condition of the state will never improve as long as there is a large number of individuals and institutions excluded from the formal financial sector. Also, financial inclusion ensures that financial institutions develop their products and compete with each other to offer cheaper and easier financial products that respect the consumer's interest.

Financial inclusion cares for many segments in society, especially marginalized segments or those who do not receive formal financial products suitable for their needs, such as the poor, low-income individuals, especially women, and owners of small, medium, and micro-enterprises, children, youth, etc. Financial inclusion ensures that all these categories receive suitable financial products for their needs and circumstances, which leads to an increase in the standard of living, thereby reducing poverty rates and achieving economic growth for individuals and the state.

How do we achieve financial inclusion? For any state to achieve financial inclusion, a study must first be conducted to know if the existing financial services are suitable and what the consumer wants from different financial services. This is the first step for the state to set goals to raise the level of financial inclusion, which will require the participation of many entities in the state.

Consumer protection is very important in this case to increase the people's trust in the banking and financial sector, which is achieved through:

• The customer receiving fair and transparent treatment and financial services and products with ease and at a suitable cost.
• Providing the customer with all necessary information at all stages of dealing with financial service providers.
• Providing consulting services if the customer needs them.
• Caring for customer complaints and dealing with them with great care.
• It is also very important to develop new financial services and products based on savings, insurance, and payment methods, not just on lending and financing, to meet the needs of all segments of society.

The state must also care about the issue of financial education and awareness, which can only be achieved through cooperation with government entities, to benefit the targeted segments that need to increase financial awareness, such as small and medium enterprises, youth, and women, which helps them make sound decisions.

Financial Inclusion Informational Brochure For Employees in the Financial Sector

What is financial inclusion? • Making financial services available to different segments of society, whether institutions or individuals (Supply side). • Working to empower segments of society to use these services (Demand side). • Providing financial services with appropriate quality and reasonable prices. Through the official channels of the official financial system.

What is the importance of financial inclusion? • Studies have proven a close relationship between financial inclusion, financial stability, and economic growth (Example: providing financing to small and medium-sized companies works to support economic growth). • Financial inclusion affects the social aspect by paying greater attention to the poor and low-income individuals, with special attention to women, and reaching individuals and small, medium, and micro-enterprises. • Achieving the public interest related to creating job opportunities, which contributes to achieving economic growth, thereby reducing poverty rates, improving income distribution, and raising the standard of living. • Providing financial services in easy and simple ways and at the lowest costs (such as payment via mobile phone).

What is the role of central banks in enhancing financial inclusion? Central banks play an important role in enhancing financial inclusion through: • Setting rules and legislation aimed at facilitating banking transaction procedures in all their forms. • Approving the availability of simplified financial services such as using mobile phones in electronic payment operations and other financial operations. • Highlighting the importance of the role of credit bureaus and developing payment systems (such as: RTGS). • Encouraging the financial sector, especially banks, to spread financial culture.

How is financial inclusion enhanced within the expansion of financial service provision networks?

• Expanding the network of branches of financial service providers and caring about creating branches or small offices for micro-enterprise financing. • Increasing the number of ATMs and any other means that would expand the network of availability of banking services. • Developing national payment and settlement systems. • Working on developing and improving communication and information exchange through expanding the provision of digital financial services (Digital Financial Services) through payment via mobile phone. • Working to create comprehensive databases including historical credit data records for individuals and small and medium-sized companies, as well as a database for registering movable assets.

The role of consumer financial protection in enhancing financial inclusion • Emphasizing that the customer receives fair treatment and obtains financial services with ease and at a suitable cost and quality. • Providing necessary and accurate information at all stages of the customer's interaction with banks, and informing customers of the advantages and risks related to the product and establishing a system to keep them informed of all updates and changes that occur to products and services on a regular basis. • The possibility of providing consulting services based on customer needs and the complexity of products and services provided to them. • Protecting customers' financial data and establishing appropriate supervision and protection systems that respect their rights. • Providing ways to deal with customer complaints, which must be independent, honest, and effective according to international best practices and subject to accountability at the appropriate time. • Raising awareness and educating customers, especially those not benefiting from financial services and their providers, on the principles of consumer financial protection to understand their rights and responsibilities and fulfill their obligations.

What is the role of banks in enhancing financial inclusion and meeting the needs of all segments of society? • Innovating new financial products based on savings, insurance, and payment methods, not just on lending and financing, with providing training for employees in this field. • Encouraging competition between banks by providing more options for customers and enhancing competitiveness between banks to maintain high-quality services at reasonable costs. • Reducing unjustified fees and commissions charged to customers, as well as inappropriate financial services that are performed in exchange for customers paying commissions. • Taking into account customers' circumstances when dealing with them and not exploiting their circumstances or burdening them with loans. • Relieving financing requirements through coordination with the Central Bank.

What is the goal of financial education and awareness in enhancing financial inclusion? • Working to establish an integrated financial education system to reach a financially literate community and develop awareness levels for all segments of the population. • Helping citizens make sound and studied investment decisions regarding their different financial transactions with the lowest degree of risk.

What must be done to advance the targeted segments of financial inclusion through financial education? • Establishing a national strategy aimed at enhancing levels of financial education and awareness and working to evaluate and measure its success, ensuring the participation of government entities, the private sector, and relevant parties in financial education. • Giving utmost care to enhancing financial awareness and knowledge among owners and managers of small and medium-sized enterprises. • Taking into account the lack of experience of new consumers regarding the use of financial services to help them realize their rights and responsibilities. • Providing consumer awareness programs through public awareness campaigns aimed at empowering consumers to make financial decisions that suit their needs.