Globally, financial health is gaining tremendous interest as a strong outcome-based concept towards driving inclusive finance and sustainable development. Working towards a financially healthy approach enables one to develop stronger communities and therefore, make progress towards attaining Sustainable Development Goals.
According to figures in The Global Findex Database, 2021, the population in the developed countries have achieved 76% bank account ownership versus developing countries have just witnessed 71 per cent account ownership. Over the years, there has been immense emphasis on financial inclusion by the governments, regulators, financial institutions and other key stakeholders.This pressing emphasis has helped strengthen accessibility and usability of bank accounts, which enables the marginalised sections to grow out of poverty and enhance their lives. As the world begins to emerge after the pandemic era and rebuild economies, there is a need to design interventions from a financial health perspective, especially when it comes to building resilient economies. Financial health is an emerging topic that works with an intention to examine, measure and enhance the financial well-being of all individuals. It is a comprehensive framework that enables financial institutions to gauge customer outcomes and empowers policymakers to analyse the success of the financial stability levels of all individuals.
The COP intends to work as a multi-faceted methodology offering a comprehensive picture - being explicitly clear about the meaning, measurement and the execution of financial well being of all individuals.
World Bank’s Global Findex 2021 stated that while 73% of population in high-income countries could access funds during emergency, just 50% in the developing countries could do the same. Financial health is a methodology for determining the status of an individual’s status to withstand financial shocks, attain existing financial obligations and achieve financial confidence.
Financial sector policymakers and practitioners utilise and measure the parameters of financial health:
Therefore, the COP aims to work towards building a collective and collaborative approach curating, assisting, enabling, convening and measuring outcome impact and achieving the SDGs.