Non - Banking Financial

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In an era full of economic and political challenges at the local, regional and international levels, the Egyptian economy is entering a new phase in its history where the state exerts great efforts towards introducing bold reforms aiming at achieving ambitious goals that we all have been wholeheartedly yearning to achieve.

Amid all these circumstances, there was a need to develop a future vision through preparing an ambitious national strategy that aligned to and integrated with the recent economic measures and reforms in a manner that would enhance the role played by the non-banking financial sector.

All this is based on the belief that the sector can play a pivotal role in supporting reform and sustainable economic development plans, aiming at improving the investment climate, which is directly related to the efficiency and development of the financial sector, as well as its role in deepening and achieving financial inclusion and facilitating access to finance, as all these are considered as the core of non-banking financial sector’s mission in Egypt.

The current economic conditions require unconventional and innovative solutions to provide new and modern tools to suit different financing needs to support growth, increase investments and employment. This supports our vision to take advantage of the sector's enormous potentials in order to improve savings rates and direct them to categories and sectors that are unable to access other forms of financing.

Many efforts have been exerted in developing the non-banking financial sector in the recent years and have had an undeniable impact. However, with the rapid developments, events and the accelerating pace of development of business communities and their needs for innovative financial solutions, the need has become urgent and necessary to create a clear institutional framework for managing and leading the restructuring and development process.  In addition, a strategic plan shall be prepared to enhance the role of non-banking financial sector markets in order to achieve the set objectives and ensure continuity of follow-up and implementation, hence comes the importance of launching a unified national strategy for the development of the non-banking financial sector.

The strategy aims to carry out structural and legislative reforms so as to enhance the ability of poor groups to improve aspects of life such as access to education, health care and human capital development in general. That is besides allowing a greater role for entrepreneurs and increasing participation of small and medium enterprises in economic growth.

 Moreover, we seek to change the concept of the non-banking financial sector from a sector controlled by the language of numbers and indicators to a more efficient, modern and dynamic sector that responds more flexibly to development plans. We aim to change it from a sector focused on growth to a sector focused on development and social justice,,, from a sector that acquires most of its services from large entities to a sector encompassing all entities and supporting the most small and medium enterprises to be the main catalyst for production and operation, including all segments of society to achieve financial inclusion and reach marginalized and poor groups.

We seek to create a non-banking financial sector that believes in equality and non-discrimination between the sexes and helps to empower women. Also, we seek to change it from a traditional sector to a modern sector based on technology, creativity and innovation that develops with every new aspect… a sector that does not fear competition and does not close itself but opens up to the outside world firmly with a desire to keep pace with the new developments.

Our ambition is to reach a sector that believes in and apply good governance, improves transparency and integrity, and undermines tools and means of corruption. The challenges facing the non-banking financial services industry may be a real opportunity to unleash the potentials of the sector by encouraging innovation, creativity and competition, and finding the right ways to integrate into the global financial system, thus maintaining the financial stability of the national economy at the same time.

Many countries have resorted to launch similar strategies for the non-banking financial sector and have had a significant impact on the development of the sector and help it to participate more effectively in sustainable development plans, access to finance and fairness in distribution of income. Therefore, the delay in the existence of a national strategy for this important sector or lack of adequate support represents a real threat to achieve objectives of the economic reforms and structural measures that have been implemented recently and it will affect the competitiveness of the Egyptian economy.

We seek to chart a road map for the non-banking financial sector during the next four years 2018-2022, we strive to achieve ambitious but realistic objectives while maintaining the stability and integrity of the financial sector and protecting the rights of the clients by achieving the following main objectives:

1. Creating a non-banking financial system that is inclusive and conducive to the economic growth.
2- Improving financial inclusion rates and contributing to sustainable development.
3- Improving the competitiveness of the national economy and its attractiveness to foreign investments.
4- Enhancing the legislative framework of the non-banking financial sector
5- Improving levels of good governance and strengthening the institutional framework of the sector.
6- Enhancing transparency and combating corruption.
7- Developing financial markets and innovating non-traditional financial solutions and services.
8- Achieving greater openness of the non-banking financial sector to the global economy.
9- Achieving better management of risks related to the safety and stability of the financial system.
10- Raising levels of awareness and financial culture.

We believe that the next four years will be a real starting point for the non-banking financial sector and for the economy as a whole if they are to be utilized in the development and implementation of this national strategy. We must recognize that the recent challenges and developments in the financial sector at the global level should take our attention and we should not resist it but we should understand and merge it into a formal and secure system that preserves the rights of all parties.

Finally, the Financial Regulatory Authority (FRA) is thanking all the parties who participated in the development of this national strategy whether they are from among the (FRA) staff or outside it. Special thanks are due to Dr. Hatem El Banna, Dr. Mohamed Omran, Mr. Abdul Hamid Ibrahim, Dr. Sahar Nasr, Mr. Hisham Ramadan, Mr. Said Arafa, Mr. Adel Khashaba, Mr. Ahmed El Sayyed, Ms. Maha Rashid (trainee) and various departments and sectors within FRA, each according to their specialization, in particular the Central Department for Research and Policies, the FRA's team of researchers, and the Non-banking Financial Services Institute.
Also, FRA welcomes any sincere effort to add to and complete the strategy, as we believe that teamwork is the best means to achieve the desired goals.


FRA’s Chairman

Dr. Mohammed Omran