Mary Daly on Why the Fed Cares about Financial Inclusion
We’re excited to launch our latest season, Financial Inclusion & Beyond, an exploration of what we can learn from efforts around the world to improve financial inclusion, health, and wellbeing. This is a topic we’ve explored in previous episodes on fintech, and we’re eager to ground global insights in the context of our modern challenges amid the COVID 19 crisis and renewed efforts to promote racial equity in the US financial system.
We begin the series with a conversation with our very own San Francisco Fed president Mary Daly. We get into why the Fed cares about financial health and inclusion, how we’re engaging and learning from a community of subject matter experts and the general public, and the significant work ahead of us. Key takeaways from the discussion include:
- True economic and financial inclusion means everyone has access to the tools that make their lives easier—the ability to meet their daily needs and accumulate wealth for themselves and their families.
- From the perspective of the broader economy, we all do better when everyone is included and participating. For policy makers, financial exclusion undermines the resiliency of the economy and hinders growth.
- The COVID-19 crisis has magnified the challenges for those citizens that are not fully included in the financial system.
- Regulators have historically relied on rules-based approaches to prevent exclusionary behavior, practices like discriminatory “red lining” in mortgage lending that prevented African Americans from buying homes in the 20th century. Negating the negative is not enough, however, and regulators need to broaden their mindset to think about how to promote positive change that delivers racial equity in the financial system, drives inclusion, and enables economic life for everyone.