On March 26 and 27, 2013, CGAP convened a roundtable with policymakers from eight countries working on youth financial services. The objectives of the roundtable were to: (i) share cross-country experiences and strategies via peer learning and exchange; and (ii) explore the role of financial services as one component of strategies for youth development.

1. 1
Policy Innovations in Youth Financial Services
Peer Learning and Exchange Roundtable
March 26-27, 2013, Paris, France
Event Highlights
On March 26 and 27, 2013, CGAP convened a roundtable with policymakers from eight countries working on
youth financial services. The objectives of the roundtable were to: (i) share cross-country experiences and
strategies via peer learning and exchange; and (ii) explore the role of financial services as one component of
strategies for youth development.
Opening Remarks
Alexia Latortue (CGAP) opened by laying out the context for the roundtable. The roundtable brought together
three unique strands: policy, youth and financial services. Policy is a powerful tool that, when used well and in
partnership with the private sector and civil society, can have profound effects on citizens’ lives by assuring
equity, redressing market failures, and promoting public goods. Youth is a time fraught with risks and laden with
opportunities. The decisions made, opportunities seized, and opportunities lost can propel youth toward
trajectories that can be transformative, or to the contrary, disappointing. Financial services have a role in youth
development by helping manage cash flows, build assets, and mitigate risks. The premise is that bringing
together the three stands of policy, youth and financial services will help youth be better prepared for the
future.
Youth are a policy priority for many countries, and governments are increasingly experimenting with using
financial services as one tool within a broader youth development toolkit. There is still a lot of room for learning
and discovery as more evidence and practice on the ground is needed to fully understand the role and impact of
youth financial services. The chart that follows shows the different parts of government involved in youth
financial services as well as their core priorities for the countries represented at the roundtable.
Brazil Colombia Egypt Ghana India Philippines UK Zambia
% of youth (age 15-24)
in country*
17.2 18.3 19.7 19.9 19.2 19.9 13.1 19.9
% of adults (age 25+)
with access to financial
services**
62.1 36.5 10.5 31.5 38.6 30.3 98 25.1
% of youth with access
to financial services**
36.3 12.8 7.8 26.5 27.3 18.3 90 12.8
Youth financial
services promoted by
government?
Financial
education
Savings,
Rural credit,
financial
education
Financial
education,
Savings
Financial
education
Savings
Savings, Financial
education
Savings,
Credit
Financial
education,
Credit
National youth
strategy?
Anchor government
agency for youth
financial services***
Colombia Joven
Egyptian
Banking
Institute
Ministry of
Finance
Ministry
of
Finance
Bangko Sentral ng
Pilipinas
Her
Majesty’s
Treasury
Bank of
Zambia
Supporting
government agencies
for youth financial
services ***
Associação
de Educação
Financeira do
Brasil
Banco de la
Republica de
Colombia, Ministry
of Agriculture
Capital
Markets
Authority
Ministry of
Youth &
Sports
Cooperative
Development
Authority, Department
of Education
Ministry of
Youth & Sport,
Ministry of
Education

2. Interview with Andrew Devenport, CEO, Prince’s Youth Business International
To get into the heart of the subject matter, Alexia Latortue asked Andrew Devenport to articulate the case for
focusing on youth development. Drawing from his work leading a global network focused on supporting youth
entrepreneurship through financial support, mentoring and technical training, Andrew Devenport stressed the
burgeoning youth population, the fact that it is easier to cultivate financial habits early in life and the inter-
generational effect of youth being at the cusp of two generations. Andrew also emphasized the positive impact
of helping young people start their own businesses on economic growth and poverty reduction.
Financing Youth Transitions
To help make the youth and finance strands of the roundtable explicit, Tanaya Kilara (CGAP) presented
important demographic trends on youth, offered a “key transitions” framework for thinking through the key
decision points in youth’s lives, and suggested ways in which finance can help manage the transitions.
Tanaya Kilara underscored that the world is in a unique period of demographic transition where the traditional
population pyramid —a broad base of young people supporting a smaller older population—is changing
dramatically and differently, across the world. As countries develop, their age structure changes. Countries face
a unique window of opportunity in the years when, with increasing life expectancy and dropping fertility rates,
the working-age population grows faster than the dependent population. This window then closes again as the
aging population increases and yet again creates high dependency levels. Low income countries can benefit
from this window, if they prepare youth to be active, well-educated and productive citizens. Africa in particular,
with over 60 percent of the population under age 30, stands to gain.
Managing these macro demographic trends well requires attention at the level of the lives of individual youth.
The World Development Report 2007 (Development and the Next Generation) emphasizes the five pivotal
phases of life that can help unleash the development of young people’s potential with the right policies. They
are: continuing to learn, starting to work, beginning a family, adopting a healthful lifestyle, and exercising
In Andrew’ Devenport’s Words
On supporting youth entrepreneurship:
“Only a madman would invest in a young person. Only if you take a holistic view, in
combination with benefits to society, then it makes sense.”
On partnerships between government and the private sector:
“We partner like crazy...If we look at our members, as they scale, it is not possible to
function purely in one sector. We must partner between government and private sector.
When it works, the upside is huge.”
On exit strategies:
“Our exit strategy can vary a lot. It’s usually two to three years but depends on the
context. In some parts of the world our model breaks down in cultures where youth
are used to receiving grants.”

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citizenship. Decisions during the five key transitions have the biggest long-term impacts on how human capital is
kept safe, developed and deployed.
These transitions take place at different times in different societies, and as such do not adhere to a strict age
range. They can also overlap, with some young people having uncomplicated lives and undergoing only one or
two transitions at a time. Others have more complex lives: they are in school, working part-time, married,
engage in risky behavior and participate in their local council – all at the same time. The transitions also have
different trajectories across gender. Successfully navigating these transitions requires that youth and
governments minimize the risks and maximize the opportunities they each bring. Clearly, finance is not all that
is needed—access to jobs, quality healthcare, good schools, and practical training are all very important. But
finance also has role in each of these transitions.
Continuing to
Learn
Starting to Work
Beginning a
Family
Adopting a
Healthful
Lifestyle
Exercising
Citizenship
Savings,
short-term
Learn to save
Seasonal needs;
Consumption
smoothing; Sending
remittances
Seasonal needs; Consumption smoothing
Savings,
long-term
Saving for
schooling
Save for business
investment; Save for
housing
Save for lifecycle
events; Save for
housing
Save for
medical
emergencies
Credit Education loans
Business loans; Home
loans; Consumer
credit; Emergency
loans
Home loans;
Consumer credit;
Emergency loans;
Education loans for
children
Emergency
loans
Payments
Receive
support
payments
Receive salaries; Pay
bills; Business
transactions
Receive salaries; Pay bills; Receive support payments
Insurance
Health; Life; Property;
Crop; Disability
Health; Life; Disability
Financial
Education
Financial
identity; Begin
using savings
Establish credit
history; Set financial
goals; Finance
business growth
Set financial goals; Use of more complex services
Youth Financial Services: A Policy Imperative?
The first day of the roundtable ended with an interactive session facilitated by Alexia Latortue (CGAP),to better
understand the opportunities and challenges that youth represent to the participating policymakers’ countries.
Participants highlighted the ways in which youth in their countries represent an opportunity.
 The sheer number of youth are a plus, if the demographic window is harnessed well
 Youth are increasingly better educated so they can participate in decision-making and contribute
economically
 Youth are productive, they can save, support aging populations, contribute capital, and enhance national
development

4.  Youth are full of energy and flexible, and are able to offer creative, new ways of thinking to create
intergenerational change
 Youth are a source of innovation
 Youth are technologically savvy, with easy access to information and the ability to adopt new technologies
that can improve lives
 The youth voice is powerful, they demand change and participate in shaping the change
Participants also shared the ways in with youth in their countries represent a challenge.
 Youth are not well prepared for the demands of the labor market, there is a mismatch between what is
being taught in schools and the skills employers need
 Youth are not perceived to be a viable client segment by financial service providers, they are seen as high-
risk with little capital and track record
 Youth constitute a significant portion of the unemployed, which in itself is a risk for societies
 Youth have major aspirations which, if left unfulfilled, can lead to them thinking they have nothing to lose
and can lead to social unrest
 Making the investments needed to meet the needs of the large number of youth will be difficult, and
require resources that not all economies have
Using a consensor device, the session then turned to policymakers’ perspectives specifically on youth financial
services as a response to leverage the opportunities and address the challenges that youth represent in their
countries. The following messages emerged.
 Participants unanimously stated that learning and working are the two most important youth transitions, of
the five mentioned earlier. Sixty-one percent voted for working as the most important transition and 39
percent voted for learning.
 Financial services can play a role in harnessing the opportunity or mitigating the challenge that youth
represent. Seventy-nine percent of participants at the roundtable were of the opinion that financial services
are important or very important in addressing youth transitions. Different financial services, however, are
relevant at different stages. For example, in the learning transition, developing good financial habits through
financial education is critical. Participants resoundingly endorsed the importance of financial education with

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Three countries, three contexts, and three challenges
Egypt: With 92 million people in Egypt, and only about half a million bank accounts, financial inclusion is
a key challenge. Changing the mindset of banks that are currently making profits comfortably to reach
out to underserved customers, including youth, is another challenge.
UK: The collapse in the financial sector exacerbated an existing problem with unemployment and under-
employment. Youth’s aspirations are also changing. Previously, after obtaining an education, youth
expected a job in a big company. The new reality is that people now often have a portfolio of activities
and sometimes need to create their own jobs as there are fewer jobs after the recession. So, they need
more flexibility and capital to respond to their aspirations.
Ghana: In spite of the reforms, the number of people who have access to financial services remains very
low. Only 35 percent of the population has bank accounts , and insurance barely has a 4 percent
penetration.
60 percent voting it as the most important aspect of youth financial inclusion. In the transition to work,
credit for entrepreneurship is the key financial service. Savings was identified as particularly important (35
percent of the vote) because having some savings built up can help delay transitions, such as staying in
school rather than starting a family at a very young age. Participants reflected on the importance of asset
building to promote a positive, future orientation.
 Discussing the role of finance without recognizing the significance of non-financial services like mentoring,
training, linkages to market, etc., is missing the larger picture of youth development.
 As this was a meeting primarily for policymakers, it is perhaps not surprising that they 75 percent felt that
the government has the primary responsibility for expanding financial access to youth (the private sector got
20 percent of votes). Participants stressed that government should be an enabler, but not a deliverer of
financial services, and that ultimately partnerships with the private sector and civil society were needed.
Some participants also cautioned that governments can play both a positive and negative role.
 Though government has an important role in youth financial services, 50 percent of participants report that
they strongly felt that their country did not have a coherent approach/strategy for youth financial services.
While some participants questioned whether a national approach was needed—perhaps regional
approaches within countries would be better—the challenge of achieving coherence among many different
government ministries was cited.
Designing for Impact – Part I
During this session, policymakers from different countries discussed specific programs they have implemented,
including the problem that the program is meant to address and the design processes that led to the policy
intervention. Scott O’Brien (Her Majesty’s Treasury, United Kingdom), Nicholas Gyabaah (Ministry of Finance
and Economic Planning, Ghana) and Ashraf Gamal El Din (Egyptian Banking Institute, Egypt) shared their
perspectives on a panel moderated by Ruth Dueck-Mbeba (The MasterCard Foundation).

6. Several themes were discussed. The highlights are as follows.
 There are numerous paths to identifying the core problem that requires a policy intervention. The UK
identified a practical problem—youth unemployment—and choose to respond quickly without much study.
They opted for an operational and iterative approach that got to the pilot stage quickly. For Egypt, the
Central Bank’s quantitative research showed that their problem was a high unbanked population, and
engaging youth came at a later stage. In Ghana, a survey tool was used to determine levels of financial
literacy among the population at large, jump-starting the country’s financial education program for youth
since that segment demonstrated the least knowledge of financial services. As Nicholas Gyabaah said, “You
cannot teach an old dog new tricks, so we need to get them young.”
 Numbers are important, but can be misleading. It is a well-known fact that the majority of new businesses in
developed and emerging markets fail. Scott O’Brien shared that his program’s targets needed to be
predicated on a 40 percent default rate, which was necessary if they wanted to fund risky businesses. It may
be counterintuitive, but if the default rate is much lower, then the program may be funding the wrong
people who were not that constrained. Ashraf Gamal El Din mentioned that quantitative targets around
new number of accounts are key, but so are the less tangible ones of increasing trust vis-à-vis banks.
 Engaging the private sector is crucial, but banks cannot be forced to act. There was a lot of discussion on the
need for banks to provide services to youth, but also on the many challenges that exist. Banks may not be
interested in investing to develop products that meet the demands of this new client segment, they may not
provide the right customer care, and they may need to make banking cheaper for low income youth,
perhaps through branchless banking. Ultimately, Ashraf Gamal El Din reminded everyone that banks are
independent and cannot be forced to do anything. Incentives sometimes work, but not always. He
suggested that creating win-win solutions is important, thus keeping the perspective of the financial service
provider in mind when designing interventions.
Designing for Impact – Part II
The second part of Designing for Impact focused on evaluating the impact of policy interventions, both in terms
of achieving social impact and sustainability. Silvia Morais (Associação de Educação Financeira do Brasil, Brazil),
Kakuwa Musheke (Ministry of Youth and Sport, Zambia) and Shameran Abed (BRAC) shared their perspectives
on a panel moderated by Tanaya Kilara (CGAP).
 Impact evidence is needed, thin to date, and resource-intensive to obtain. Silvia Morais presented some
strong results from Brazil’s experience piloting the insertion of financial education into the school system.
Impact evaluation through a Randomized Controlled Trial (RCT) was embedded in the roll-out of the
program with the support of the World Bank’s Development Impact Evaluation Department. The results are
very promising: there is a 7 percent increase in knowledge after 6 months of treatment and 7 percent of
students saving more after 18 months. Participants reflected on the importance of thinking about the
impact evaluation approach from day one, as was the case with Brazil, rather than as an after-thought. All
agreed that rigorous impact evaluations are necessary to prove assumptions and also convince governments
about the value of these interventions. The discussion also revealed questions about the appropriate level
of resources (money, time, people) for evaluations, and also how much evaluation is enough.

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 Need to think differently about sustainability. There was consensus among participants that youth financial
services on their own would likely not be attractive to banks. Scott O’Brien, for example, cited the
experience of trying to incentivize banks to lend to SMEs. The UK Government provided banks with cheap
funds to lend to SMEs but they still preferred to lend to larger customers. They also tried guarantees but the
additional lending it drove was marginal. This led the UK Government to look for a non-bank solution when
trying to do youth lending. Shameran Abed supported this point of view, saying that “if you start with the
premise that you have to be sustainable, then some things would never start.” He argued that the providers
that target the youth segment invariably also have social goals in addition to recognizing the lifetime value
of young customers. For example, BRAC cross-subsidizes the unprofitable parts of its portfolio like the youth
products with its more profitable products. If having a social goal is a pre-condition for institutions to target
this segment, perhaps the discussion on youth financial inclusion needs to move past banks and toward a
range of more socially oriented providers. Technology came up on several occasions as one promising
opportunity to help the economics from the perspective of financial service providers.
 There is a role for subsidy, but getting it right is not for the faint of heart. Policymakers recognized that
subsidy was required to reduce the risk of entry for the private sector (refer to previous point) and because
some benefits accrue to society rather than to individual players. The discussion then turned to how that
subsidy could be structured in smart ways to avoid or minimize market distortions. There were many
cautionary tales, including from Kakuwa Musheke about the threat of political capture when the
Government gets into the business of delivering financial services. Finally, Scott O’Brien presented one way
to think about subsidy holistically. He spoke of “whole government accounting”, which refers to the idea
that subsidy in the short-term by one part of the government is offset in the longer-term by job creation,
reduction in welfare benefits, GDP growth, etc.
The Role of Regulation
This participatory session, led by Tim Lyman (CGAP), focused on key issues in creating an enabling and protective
policy environment for youth financial services. Fe de la Cruz (Bangko Sentral ng Pilipinas, Philippines) and
Mukhmeet Bhatia (Ministry of Finance, India) shared their country’s experiences with recent regulatory changes.
There was also discussion on the significance of political economy in rule making within the various branches of
government.
Policymakers discussed country-level examples of enabling policies around youth savings and youth credit. This
included the removal of regulatory barriers (e.g., legal age to open savings accounts dropped to age 7 in the
Philippines), mandates (priority lending requirements in India) and public subsidies (government credit schemes
for youth start-ups in the UK and Zambia). See chart below.
Youth Savings Youth Credit
e.g., legal age to open accounts e.g., legal age to enter contracts
e.g., matching grants for accounts
e.g., government credit schemes
for youth business start-ups
Removing regulatory barriers
Public subsidy / incentives
Other “enabling”?
Mandates e.g., account at birth requirements e.g., priority lending
requirements
e.g., public awareness campaigns e.g., unique IDs

8. Sometimes, broader policies, which are not targeted at youth or even at financial services, can have a profound
impact on youth financial services. When the Aadhar unique ID/biometrics program in India was designed,
neither youth development nor financial inclusion was a major policy driver, but the program has important
implications for both. For the Government of India, Aadhar meets know-your-customer requirements for
opening bank accounts and can serve as a gateway to a range of products and services. For example, the
Government of India is using this technology to transfer 16 million scholarships to students, essentially requiring
the youth to have bank accounts.
On the protective side of the equation, policymakers discussed government’s role in reducing the risks youth
face (e.g., high fees eating into youth savings). Systemic financial consumer protection issues can undermine the
broader repayment culture. There was also some discussion around promoting standards for child-friendly
youth savings products and how we are not yet at the point where there could be a regulatory standard, since
there is no body of evidence for overall consumer protection.
Forging Innovative Partnerships for Collective Impact
The final session began with a brief presentation by Alexia Latortue (CGAP) on a collective impact framework
and its conditions for success: a common agenda, shared measurement systems, mutually reinforcing activities,
continuous communication, and backbone support. Patrick Karangwa (PAJER, Rwanda) provided his perspective
from civil society partnering with the government, followed by Shameran Abed (BRAC) whose perspective stems
from being a financial service provider.
Patrick Karangwa shared success factors in PAJER’s strategy of partnering with the government, such as:
alignment with the Government’s Poverty Reduction Strategy 2020; remain apolitical and work with every
minister who comes to office regardless of political party; ensure buy-in from the government throughout the
whole process; and serve as an incubator for programs that the government can later scale up. Shameran Abed
provided three examples of exemplary public, private and government partnerships: in Bangladesh, the Central
Bank worked with NGO MFIs to give them cheap credit so that they would then re-lend to small farmers for an
interest rate of 5 percent instead of 11 percent; in Rajasthan, India, the State Government provided matching
funds for the national pension scheme, which was managed by private companies at the back end and
distributed by NGO MFIs at the front end; and affordable health insurance in India where NGOs are doing front
end distribution, large private sector insurance companies own the insurance, and the government is re-insuring
that insurance (essentially providing a subsidy).
After a brief discussion, the session broke out into a group exercise in which participants designed a policy
response that addressed one of the youth transitions discussed on Day 1. Participants were given 1 million
“Youthistani” dollars for the intervention, and a 5-year timeframe for implementation. In the spirit of the
session around partnership, participants assumed roles (Ministry of Finance, Ministry of Youth, financial service
provider, civil society) in their respective groups.
The session ended with brief presentations of the various policy interventions that the groups designed, which
covered a range of financial services, including a micro-insurance policy for the “staying healthy” transition, a
delayed matching savings product for the “starting a family” transition, a job placement and information hub for
the “working” transition, and integrating entrepreneurship as part of the school curriculum for the “learning”
transition. Each program required the collaboration of various government agencies, the private sector, civil
society, and in some cases, the youth themselves. All the interventions had some level of subsidy, though a few

9. 9
groups considered the issue of sustainability, for example through user fees. The issue of how to access youth
who are not in the formal schooling system also emerged. All groups expressed some difficulty in defining key
performance indicators to measure success, reflecting the challenge that monitoring and evaluation represents.
What’s Next?: Continuing the Dialogue on Policy Innovations in Youth Financial Services
Dissemination of discussions of the roundtable to get messages to a broader audience. We want to
ensure that our discussions can be shared more broadly, and will be using several channels to do so.
 Share roundtable highlights with interested parties who could not attend the event, including:
Alliance for Financial Inclusion, policymakers from countries that could not attend (e.g., Canada,
Jordan, Rwanda, US), members of the YouthSave Consortium and other MasterCard Foundation
youth grantees.
 Distribute the short video from the Roundtable broadly and actively integrate it into other
events focusing on youth financial services, including the upcoming Making Cents Conference in
September 2013 in Washington, DC, and the CYFI Summit in May 2013 in Istanbul.
 Further delve into topics raised during the roundtable through several blogs planned for both
the CGAP and Youthsave Consortium's websites. A sample of topics include: credit for youth
entrepreneurship (case of the UK) and evidence-based financial capability programming (case of
Brazil, in conjunction with the World Bank).
Assisting participants with continued peer exchange. CGAP has created a listserv/email list so that the
participants can continue exchanging ideas and experiences or ask each other for advice:
CGAPYouthFinancePolicy@worldbank.org.
Exploring the business case. CGAP will continue to work on exploring the business case for youth
financial services.