‘Competitive banking helps in fighting poverty’

‘Competitive banking helps in fighting poverty’

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The World Bank has tasked financial institutions to engage in more friendly competitive banking if they are determined to end poverty across the globe.
The Group President, World Bank, Mr. Jim Yong Kim, said, “International banking does create risks of exporting instability, especially for countries with poor regulations and institutions, and those risks need to be mitigated. But without a competitive banking sector, the poor will not be able to access basic financial services, many businesses will be locked out of markets, and growth in developing countries will stall.”
He pointed out that as aspirations continued to rise all over the world, and the banking sector evolved, there was a critical question: “will finance be a friend or foe in the fight to end
poverty?”
Kim recalled that the 2007-2009 crisis and economic downturn prompted an extensive re-evaluation of the benefits and costs of international banking, and led to restrictions that brought a decade-long surge in financial services and cross-border lending to a halt.
He said, “For Nigeria and other developing economies, their policymakers would do well to consider how to maximise the benefits of cross-border banking, as well as minimise its costs simultaneously.
“Besides, there is growing international evidence, which suggests that foreign investors hold more long-term domestic debt than domestic investors.”

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