Three convictions about financial inclusion


In 2021, I had a few opportunities to speak in the press about financial inclusion, a topic that is important to me and that I would like to come back to by sharing three major convictions:

1.    The Covid-19 crisis has amplified and accelerated pre-existing trends

For a couple of years, individuals, politicians, and many other economic and social actors have been pushing for a world which reduces further social dislocation and ensures a better share of the dividends of economic growth.

As with many crises, the Covid-19 one will not change pre-existing trends; it will amplify and accelerate them. And if we do not succeed in meeting this demand for higher inclusion in the coming years, we will increase the risk of a complete dislocation of our social, political and economic models.

Banks, as critical actors in the economic development and traditional absorber of economic cycles, can and will have to play a critical role in this respect.

2.    In Transaction Banking businesses, banks can help to reduce the social fragmentation

Here are some illustrations:
First, digital payments have increased dramatically. We see in all economies the reduction in cash flow. This has forced a segment of the marginalised population to connect to the full service of digital finance, and that is progress.

Trade finance is at the heart of shared growth in the world. The importance of Societe Generale’s presence in Africa and our strong capacity to accompany trade flows between Africa and other parts of the world is clear evidence of Societe Generale’s contribution to helping to advance the continent economically.  

Finally, supply chain finance can provide useful solutions to help large groups finance their SME (small and medium enterprises) suppliers and clients. Societe Generale has the knowledge and capacity to make a significant contribution to the fast-developing market of factoring and supply chain finance solutions. It will definitely play a key role in 2022 when the time will come to refinance the financial support brought by the different governments across the world during the crisis. 

3.    Banks have a key role to play in the fight for financial inclusion

Banks, including Societe Generale, have been doing their utmost to help clients to overcome the crisis by offering them advice and financial solutions to improve their future resilience. Societe Generale, in particular, has actively taken part in the different programs launched by the government to preserve the French economy: PGE (State Guarantee Plan), Equity Loans, Reverse Factoring programs. 

Large banks like Societe Generale can also leverage on solutions they have developed for bigger clients to support SMEs. For instance, Societe Generale has developed a partnership with Kyriba to offer a TMS solution to our SME clients. Thanks to this partnership, these clients will gain a better capacity to manage and forecast their liquidity situation and to finance their short-term needs. 

Beyond the measures related to the global pandemic, Societe Generale is committed to being a responsible bank, fully playing its role as a shock absorber, to find a balanced way to support the many vulnerable economies, SMEs and industry sectors, whilst managing risks prudently.

More generally, my personal conviction is that over the next five years, regulators will encourage us to measure and demonstrate what we are doing to reduce social fragmentation and promote equitable sharing of economic growth. We are already doing huge amount in this area. Let us not wait for pressure from regulators to continue working towards more inclusive and better shared growth.