Sean Creehan

Fintech Risk & Policy Advisor

Sean Creehan is the lead for financial health, inclusion, and technology on the Fintech team. Before joining the Fed, Sean worked as a management consultant to clients investing in Asia. He holds a master’s in international economics from Johns Hopkins School of Advanced International Studies and a bachelor’s in social studies from Harvard College. He spent a postgraduate year as a Harvard-Yenching Scholar at Peking University, and speaks Mandarin Chinese and Indonesian. In addition, he is a Chartered Financial Analyst (CFA) and a term member of the Council on Foreign Relations.

Contact Sean Creehan

Pacific Exchange Blog Entries

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India’s Non-banks Emerge from the Shadows

Posted May 31, 2019

Discussion of shadow banking in Asia is often dominated by developments in China, but India’s non-banking financial companies are gaining increasing attention as among the fastest growing in the world. Meanwhile, the bankruptcy of a large Indian NBFC in 2018 has put the sector under media scrutiny. Despite increasing risks to growth, India’s NBFC sector is still on track to expand at a rapid pace as it plays an important role in the financial system.

India’s Aadhaar Challenge: Balancing Data Rights, Financial Inclusion, and Innovation

Posted March 4, 2019

India’s adoption of unique biometric identities, known as Aadhaar, has catalyzed inclusion and innovation in financial services. However, Aadhaar has always raised concerns over the appropriate use of digital IDs in the broader social fabric. With India’s Supreme Court recently restricting Aadhaar’s use, its role is now in question. Financial market participants will have to adjust to shifts in rules as they balance emerging data rights with gains in inclusion and innovation.

Asia’s Open Banking Push

Posted December 5, 2018

Countries around Asia are implementing laws and regulations to promote open banking to share data and enable third parties to provide products and services around a centralized platform. A move to open banking reflects the increasing digitization of Asia’s economy and the rise of technology platforms that envision a consolidated financial life for their customers. The impacts could be dramatic, increasing competition and promoting efficiency, integration, and inclusion, while also creating new risks.

Can Asia’s Fintech Giants Reduce Remittance Costs?

Posted September 20, 2018

As they transform the payment systems in countries like China and India, Asia’s fintech giants are now setting their sights on cross-border remittances. Will the new entrants drive costs down in a region dependent on payments sent home by overseas workers? A number of traditional financial institutions and non-bank start-ups are already trying to solve the problem, which could help promote equitable, inclusive growth in developing Asia.

Asia Prepares for New Bail-in Bonds

Posted July 3, 2018

A decade removed from the global financial crisis, the world’s most systemically important banks are preparing to meet new rules on total loss-absorbing capacity (TLAC) by 2019. New TLAC-eligible debt securities, popularly known as “bail-in” bonds, have emerged post-2008 as part of efforts to minimize the need for taxpayer bailouts in future crises. In Asia, banks in Japan and China will face tailored versions of these requirements based on the unique features of each country’s banking system. Below, we examine the state of TLAC in Asia.

Asia’s Aging Workforce May Boost Its Markets

Posted May 1, 2018

The demographics of aging have long been studied as a key driver of investment behavior in capital markets, as changes in life stage alter investor preferences. Asia is home to countries with a diverse range of demographic profiles, with several rapidly aging countries like Japan, Korea, and China, and younger populations in India and Indonesia. Building upon other research into the relationship between demographics and capital markets, this post considers how aging may impact the region.

India’s Digital Payments: Growing Consumer Trust, but Merchants Needed

Posted February 28, 2018

More than a year after the shock of demonetization, Indian consumers continue to adopt digital payments as an alternative to cash. Though overall transaction volumes remain small relative to cash, the growth of mobile payment products indicates growing trust. Recent successes in promoting new products could also point the way to greater merchant adoption, providing insight for India and a number of other countries transitioning to new payment technologies.

Digital Currencies May Take off in Japan

Posted November 27, 2017

Not long ago, Japan was at the cutting edge of digital payments. Japanese consumers could make payments by phone as early as 2001, a decade earlier than in the United States. Despite this early lead in payment technology, visitors to Japan today often note the remarkable persistence of cash. In this context, Japanese banks are launching digital currencies, while changes to regulation in China have made Japan a hub for bitcoin trading. These trends could renew Japan’s role as a leader in payments innovation.

If You Build It, They Will Lend: Why Japan May Fund More Infrastructure than China

Posted October 12, 2017

Demand for infrastructure is growing as developed countries replace deteriorating infrastructure and emerging economies invest in new projects. China has attracted significant attention through its One Belt, One Road initiative and the founding of the Asia Infrastructure Investment Bank, but Japan has recently dominated global project finance. With low borrowing costs and limited domestic credit demand, Japanese banks may be best positioned to lead the financing of a global infrastructure push.

Large Japanese Capital Flows Pose Risks to the Asia-Pacific

Posted June 2, 2017

Japanese investors have long been known for their overseas investments. Following the 2013 onset of the Bank of Japan’s extraordinary monetary policy, the country’s pace of overseas investments has accelerated even further. While Japanese investors have been buying assets around the world, several Asia-Pacific countries have experienced particularly large capital inflows, exposing them to future changes in Japan’s economy and monetary policy. Among them, Thailand and Australia stand out as having high exposure to Japan.

Demonetization Is Catalyzing Digital Payments Growth in India

Posted April 12, 2017

Nearly six months after India’s momentous demonetization, the government continues to expand options for digital payments to reduce the economy’s dependence on cash. While old habits die hard, recent data show that new digital payment methods are building momentum. These innovations offer simple, universal tools that may help India leapfrog older technology to reach a less cash-intensive future.

India’s Demonetization: The Long Road to a Cashless Future

Posted December 16, 2016

The chaotic aftermath of India’s recent demonetization shows how crucial cash remains to daily life in developing countries. The disruption also exposed the technological barriers to the transition to a less cash-dependent economy. As the Indian government announces further incentives for cashless payments, the demonetization shock may also jumpstart existing policy efforts to develop a more digital economy.

Can Fintech Fill Asia’s SME Lending Gap?

Posted October 20, 2016

Perhaps no sector has more to gain from innovations in financial technology than small- and medium-sized enterprise (SME) finance, especially in Asia. SMEs accounted for 42 percent of Asia’s GDP in 2014 yet received only 18.7 percent of bank lending according to the Asian Development Bank. Fintech can particularly leverage the rapid growth of Asia’s e-commerce and regional trade, trends that complement SME development.

Reducing Remittance Fees can Boost Asian Economies

Posted August 24, 2016

Remittances exceeded $600 billion worldwide in 2015 with more than two-thirds going to developing countries. Developing Asia receives more remittances than any other region—roughly $200 billion—and in some countries remittances even exceed foreign direct investment inflows. Meanwhile, innovations in payment systems can reduce remittance fees dramatically, increasing the earnings sent back to migrants’ friends and families—and supporting economic growth in Asia.

Japanese Investors Go Abroad with Borrowed Foreign Currency

Posted June 29, 2016

A half-year into the Bank of Japan’s experiment with negative interest rates, there are growing signs of unusual market activity in Japan, with yields on even long-term government debt going negative and ever-increasing overseas investment. Amid a breakdown in longstanding financial relationships that previously allowed international investors to hedge currency risk cost effectively, Japanese investors are increasingly funding their overseas portfolios with foreign currency debt to minimize foreign exchange risk.

How Modernizing India’s Payment System can Drive Financial Inclusion

Posted April 26, 2016

India’s heavy reliance on cash has wasted resources and limited financial inclusion, leaving nearly half the population without a bank account. In response to this problem, the government has introduced policies to promote non-cash payments, provide hundreds of millions of new payment-capable accounts to the unbanked, and encourage new technology and innovation throughout the banking sector. The combined effect of these efforts could have a major impact on economic welfare and financial inclusion in the coming years.

The Global Impact of Chinese and Japanese Economic Growth

Posted March 31, 2016

Thirty years ago, Japan was growing so quickly that some predicted it would overtake the United States, while China’s economy was small and closed. Much has changed. China has overtaken Japan as the world’s second largest economy, but as China shifts to a “new normal” of lower growth, observers are increasingly concerned that it may no longer serve as the world’s economic engine. Meanwhile, proactive Japanese economic policy has renewed interest in Japan’s prospects.

The Bank of Japan Goes Negative: What Does That Mean?

Posted February 17, 2016

The Bank of Japan surprised markets last month by implementing a negative interest rate policy as part of its continued fight against deflation. Negative rates turn the traditional rules of finance on their head and may confuse some market participants. Though ordinary borrowers and savers are unlikely to see negative interest rates at this stage, the new regime will impact the Japanese banking system and possibly the country’s international financial linkages.

What is Asia’s Most Systemically Important Bank?

Posted January 28, 2016

The Financial Stability Board (FSB) recently updated its list of global systemically important banks (G-SIBs), adding China Construction Bank as the seventh Asian G-SIB. Including Standard Chartered, a U.K. incorporated bank with a majority of assets in Asia, more than a quarter of G-SIBs now operate primarily in Asia.

Developing Local Currency Bond Markets
 Can Help Insulate Asia from Volatility

Posted October 2, 2015

Many Asian borrowers increased their dollar-denominated debt in recent years amid the extraordinarily low rate environment. Recent volatility has been characterized by capital outflows from Asian economies where such debt accumulated. While emerging Asia remains vulnerable to further capital flight with a majority of external debt in foreign currency, its bond issuances are largely in local currency. Further deepening of bond markets combined with increased local currency debt can insulate emerging Asia from further volatility.

Why We Shouldn’t Invoke Japan’s “Lost Decade” as China’s Future

Posted August 10, 2015

China’s transition to a new period of slower growth naturally draws comparison to other countries’ historical development. Given its recent experience with rapid credit expansion, build-up in real estate, and stock market volatility, some observers wonder whether China faces a “lost decade” like the one Japan experienced in the 1990s. This comparison is inappropriate, however, and contributes to a misunderstanding of the challenges China does face and a misremembering those Japan encountered a generation earlier.

Asian Banks Go Global

Posted July 17, 2015

One of the most striking trends following the global financial crisis has been the slowdown and retrenchment of cross-border lending. Due to financial distress, many large global banks, particularly those from Europe, had to reduce their international exposure and pull back funding to their home markets.

Asia’s Corporate Debt Poses Risks as Dollar Climbs

Posted June 19, 2015

Companies across emerging markets issued a record $276 billion in U.S. dollar-denominated bonds in 2014 as they took advantage of low U.S. interest rates, and Asian corporates were no exception. Combined with the strengthening dollar, high levels of dollar-denominated debt increase risks to Asian banking asset quality, particularly when borrowers leave foreign exchange risk unhedged. Asia has made substantial progress building financial system resilience and foreign exchange reserves over the past two decades, but external debt still poses risks for many countries including India, Indonesia, and even China.

Pacific Exchanges Podcasts

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Posted October 14, 2021

We’re excited to share a special episode in partnership with our colleagues in the San Francisco Fed’s Community Development group. Our teams recently collaborated on a special issue of the Community Development Innovation Review in partnership with the Aspen Institute’s Financial Security program, which examined the potential ways financial technology can promote racial equity in the financial system. Today’s episode features audio from the journal’s live launch event.

Posted July 15, 2021

Our Pacific Exchanges team recently hosted a special Financial Inclusion and Beyond live virtual event moderated by Sean Creehan, the team’s lead for financial health and inclusion, that explored lessons from around the world in the use of technology and public policy to build more inclusive financial systems and drive financial health. Regular listeners of the podcast will recognize these voices from their episodes throughout the season; the live virtual event allowed them to discuss how they were managing the challenges to inclusion posed by the COVID pandemic.

Posted May 10, 2021

In episode eight of Financial Inclusion & Beyond, we spoke with Tracy Basinger, the recently retired head of supervision at the San Francisco Fed. We get into examples of innovations promoting inclusion and challenges for regulators and who want to minimize risks while not getting in the way of positive change. And we talk about shifting from a historical mindset focused on preventing exclusion to one that thinks about promoting financial health and wellbeing.

Posted May 6, 2021

In episode seven of Financial Inclusion & Beyond, we spoke with Matt Homer, Deputy Commissioner of the Research and Innovation division of the New York State Department of Financial Services. We get into the benefits of inclusive technology, but also the potential for digitization to exclude some vulnerable populations and the unexpected challenges policymakers and firms face in delivering new financial services to people that previously lacked access.

Posted May 3, 2021

In episode six of Financial Inclusion & Beyond, we spoke with Chris Calabia, the Senior Advisor for Supervisory and Regulatory Policy, Financial Services for the Poor, at the Bill & Melinda Gates Foundation. We sat down to discuss how to drive financial health for the world’s poor by improving access to essential financial services through better public policy and regulation.

Posted April 29, 2021

In episode five of Financial Inclusion & Beyond, we spoke with Ting Jiang, a behavioral economist who researches and designs products for behavioral change. At the time of this recording, which took place before the pandemic, Ting was associated with Duke University’s Center for Advanced Hindsight. We sat down to discuss the way behavioral scientists and product designers work together to build better financial products that help people take action to improve their financial health.

Posted April 22, 2021

In episode three of Financial Inclusion & Beyond, we spoke with Arjuna Costa, managing partner of Flourish Ventures, a leading social impact fund focused on financial health. Arjuna invests in entrepreneurs around the world to catalyze innovations that help people achieve financial health. We sat down to discuss the way entrepreneurs are harnessing the power of behavioral economics and customer-centric design to meet the everyday financial challenges of low income populations.

Posted April 15, 2021

Today we begin a new series, Financial Inclusion & Beyond, an exploration of what we can learn from global efforts to build a more inclusive financial system. We begin with San Francisco Fed president Mary Daly and talk about 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.

Posted September 10, 2019

In this episode of Rethinking Asia, we spoke with Chad Bown, Senior Fellow at the Peterson Institute for International Economics. Chad is an expert on trade, having worked on the issue at the World Bank, the White House Council of Economic Advisors, and the World Trade Organization. We discussed the recent trade disagreement between South Korea and Japan. While, rooted in the countries’ deep historical, political, and social tensions dating back to the early 20th century, the attitudes and tactics adopted in the dispute reflect broader global tensions surrounding trade.

Posted July 12, 2019

In this episode, we sat down with Nick Lardy, senior fellow at the Peterson Institute for International Economics. Nick is one of the world’s most prominent analysts of China’s economic development and the role of its private sector in generating growth. We sat down to discuss Nick’s new book, The State Strikes Back: The End of Economic Reform in China? Nick walked us through some troubling statistics about the Chinese private sector’s diminishing role as measured from a number of data sources and qualitative indicators of slowing economic reform.

Posted May 2, 2019

We continued our series on fintech in Asia with Toshio Taki, the co-founder of Money Forward, a Japanese fintech firm, and director of an association that promotes open APIs in Japan. Toshio talked about the open banking and API landscapes in Japan, comparing Japan to global peers. Toshio is pushing for greater adoption and integration of financial technology services among Japanese clients, and looking to shift Japan from its reliance on cash.

Posted March 6, 2019

In this episode of our series Rethinking Asia, we spoke with Ken Hokugo, head of Corporate Governance and the director of Hedge Fund Investments at Japan’s Pension Fund Association, with more than $120 billion in assets under management. Ken is a strong advocate for Japanese corporate governance reform. Ken discussed the challenges Japan faces implementing corporate governance reform. Ken showed how cross-shareholdings and lack of independent directors are rooted in historic and structural factors and dampen enthusiasm for Japanese stocks.

Posted November 5, 2018

In this episode of Rethinking Asia, we interviewed Kathy Matsui, vice chair of Goldman Sachs Japan. She is a prominent advocate for women in the workforce and serves as a policy commentator for Japan’s Cabinet Office. Kathy guided us through the factors that have led to the current gap between the high skill and education levels of Japanese women and, in many cases, their absence from full-time work.

Posted September 24, 2018

In this episode, we interviewed Simone di Castri, the Managing Director of the RegTech for Regulators Accelerator (R²A). R²A is a new initiative to help financial authorities harness innovative technologies and advance promising RegTech solutions. Simone described R²A’s collaboration with financial authorities in Mexico and the Philippines is helping central banks better understand markets and customer needs in data-rich environments.

Posted September 10, 2018

In this episode, we interviewed David Hardoon, the Chief Data Officer of the Monetary Authority of Singapore. We spoke with him about the innovative uses of machine learning and big data among banks and the financial system. We covered why regulators and institutions must be concerned with the ethical use of data in new AI applications, and how algorithms can help or hinder financial inclusion.

Posted August 10, 2018

In the fourth episode of Rethinking Asia, we interviewed Matthew Goodman, the William E. Simon Chair in Political Economy at the Center for Strategic and International Studies (CSIS). At CSIS, he leads the Reconnecting Asia program, which tracks how infrastructure is shaping economic and geopolitical realities in Asia. Our discussion touched on Asia’s huge demand for new infrastructure, the complex geopolitical tensions among regional and multilateral actors, and China’s Belt and Road Initiative.

Posted July 30, 2018

In our third episode of our series Rethinking Asia, we spoke with Andy Rothman, an investment strategist for Matthews Asia. Prior to joining Matthews Asia, he worked for 20 years in China, and now uses that experience to shape the firm’s thoughts on China from an investment perspective. Andy helped us understand the future of Chinese growth, its current state of domestic consumption and China’s efforts to rebalance away from investment and exports towards consumption.

Posted July 23, 2018

In the second episode of our series Rethinking Asia, we spoke with Manoj Pradhan of Talking Heads Macro in London. He’s an expert in the relationship between demographics and capital markets, looking at how aging and labor force changes impact everything from global interest rates and wages to inequality. Prior to his current role, he worked as a macroeconomist at Morgan Stanley.

Posted June 29, 2018

Today we launch a new series, Rethinking Asia, as we consider noteworthy and unusual trends in Asian finance and economics. In our first episode, we sat down with Jesper Koll, head of Japan at WisdomTree, a global asset manager. In our conversation, Jesper discusses in depth the history and forces behind Japan’s distinction as a safe haven for global investors. He explains why assets like the yen and Japanese government bonds rally during periods of regional or global turmoil.

Posted February 12, 2018

In the final episode of our series on the Asian financial crisis, we take a look back at key themes and takeaways from our conversations. We also discuss Nick’s recent research paper on Asian bond market developments since the crisis.

Posted December 12, 2017

In this episode of our series on financial technology, we sat down with Souheil Badran, president of Alipay North America. Alipay is the payments spinoff of China’s ecommerce giant Alibaba and is now part of Ant Financial, the largest fintech company in the world.

Posted December 5, 2017

In this episode of our series on financial technology, we sat down with Katie Macc, co-founder and chief operating officer of Juntos Global, a fintech company that serves as a bridge between financial access and financial inclusion for the world’s newly banked. Kate tells us about the ways technology can help solve many of the problems facing the unbanked around the world.

Posted November 29, 2017

In this episode of our series on financial technology, we sat down with Kate Lauer, an expert in microfinance, financial inclusion and global financial regulation. At the time of this interview Kate was a senior policy advisor at CGAP, where she was researching the impact of regulatory sandboxes on fintech and financial inclusion. Kate recently became the Head of Global Regulatory Strategy at PayPal.

Posted November 2, 2017

In the eighth episode of our series on the Asian financial crisis, we spoke with Don Hanna, a prominent international economist who has advised investors on Asia for over three decades. Don has worked as an economist at a variety of global financial institutions and multilateral organizations and lived in the region for 16 years. He has written extensively on Asia’s economic and financial development since the crisis.

Posted October 18, 2017

In the seventh episode of our series on the Asian financial crisis, we spoke with Barry Eichengreen, a professor of economics and political science at UC Berkeley. He’s written extensively about the sequencing of financial opening in Asia and the challenges associated with cross-border capital flows. He’s also authored numerous articles looking back on the lessons from the Asian financial crisis.

Posted September 5, 2017

Continuing our series on the Asian financial crisis, we talked with Simon Johnson, a professor at the MIT Sloan School of Management and a Senior Fellow at the Peterson Institute for International Economics. He previously served as the Chief Economist of the International Monetary Fund and has written numerous articles on both the Asian Financial Crisis and the global financial crisis.

Posted August 21, 2017

In the third episode of our series on the Asian financial crisis, we talked with Andrew Sheng, a Distinguished Fellow at the Asia Global Institute. Andrew has worked as a central banker, financial regulator, academic, and advisor to numerous Asian financial organizations. He had firsthand experience of the Asian financial crisis when he was serving served as the Deputy Chief Executive of the Hong Kong Monetary Authority.

Posted August 7, 2017

In the second episode of our series on the Asian financial crisis, we talked with Gillian Tett, U.S. managing editor of the Financial Times. Gillian was based in Asia at the time of the crisis and witnessed it spread across the region. In the interview, she relays her experience in Asia in 1997 and how it helped her spot warning signs ahead of the 2008 global financial crisis.

Posted July 24, 2017

In the first episode of our series looking back on the Asian financial crisis, we interviewed David Dollar, a senior fellow at the Brooking Institution. David worked as an economist at the World Bank for 20 years, focusing on a variety of Asian economies. He also served as the U.S. Treasury’s economic and financial emissary to China, based in Beijing.

Posted July 5, 2017

In this episode of our series on financial technology, we sat down with Ning Tang, founder and CEO of CreditEase. Ning has been a leader in the development of China’s peer-to-peer lending industry and has a unique perspective on the impact of fintech worldwide.

Posted June 9, 2017

Continuing our series on financial technology, we sat down with Jason Loughnane, microfinance specialist with Accion International in Myanmar. Jason is an expert on the potential for mobile payments and other financial technologies to promote financial inclusion in emerging markets.

Posted May 10, 2017

Asia is currently in the midst of a fintech revolution, with new technologies and startups threatening to disrupt the banking sector in economies across the region. In this episode of Pacific Exchanges, CAU analyst Cindy Li sat down with Nicholas Borst and Sean Creehan to discuss their recent paper on fintech developments in Asia.

Posted February 15, 2017

Shadow banking has grown quickly in China, driven by regulatory arbitrage and the growing role of non-bank financial institutions in the financial sector. In this episode of Pacific Exchanges, we sat down with our colleague Cindy Li to discuss her recent paper on shadow banking in China.

Posted December 28, 2016

In the fifth episode of our series on financial technology, we sat down with Zhong Wang, Head of Strategy and Overseas Payments for Baidu Wallet and Payment Services. We invited Zhong to speak with us about why payments innovations are occurring so rapidly in China, the competitive threat that new payment companies represent to banks, and how developments in payments may impact other parts of the Chinese financial system.

Posted December 12, 2016

In the fourth episode of our series on financial technology, we sat down with Anju Patwardhan, a Fulbright Fellow researching fintech at Stanford University who previously served as the Chief Innovation Officer for Standard Chartered Bank. We invited Anju to speak with us about her experiences managing fintech activities at a bank, the potential for collaboration and competition between fintech start-ups and traditional banks, and her research activities at Stanford.

Posted November 28, 2016

In the third episode of our series on financial technology, we sat down with Shuhei Aoki, Executive Strategist at Hitachi. We invited Shuhei to speak with us about the reason non-financial companies are getting involved in FinTech and how the space is impacting Asia and places like Hitachi’s home market of Japan.

Posted November 14, 2016

In the second episode of our series on financial technology, we sat down with Sacha Polverini, a Senior Program Officer at the Bill and Melinda Gates Foundation. We invited Sacha to speak with us about the challenge of financial inclusion in Asia and how fintech can make a difference.

Posted October 31, 2016

In Episode 1, we sat down with Sopnendu Mohanty, the Chief Fintech Officer at the Monetary Authority of Singapore (MAS). We invited Sopnendu to speak with us about the role of fintech in Singapore’s financial system and the central bank’s approach to encouraging innovation while managing risk.

Asia Focus Publications

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How Digital Innovation Can Increase Small Business Access to Finance in Asia

Posted March 26, 2018

This Asia Focus summarizes the small- and medium-sized enterprise (SME) credit gap in Asia and assesses ways certain emerging technologies and innovative business models—commonly known as “fintech”—can improve SME access to financial services in Asia and boost long-term economic growth in the process.

Asia’s Fintech Revolution

Posted February 27, 2017

This Asia Focus examines the impact of fintech on payments and lending in Asia, focusing on the new technologies entering the market, the level of disruption faced by banks, and the regulatory response to these new developments.

Modernizing the Payment System to Increase Financial Inclusion in India

Posted March 31, 2016

This Asia Focus reviews the role non-cash payments can play in India’s financial inclusion efforts, summarizes recent government policies to develop a national payment system that includes the unbanked, and assesses the challenges and implications of ongoing reforms.

Priority Sector Lending in Asia

Posted September 15, 2014

This Asia Focus discusses Asia’s experience with priority sector lending, reviews the current state-level priority sector lending policies in several Asian economies, assesses the implications for the respective domestic banking systems, and examines potential alternative mechanisms to encourage lending to priority sectors.