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14 October 2016

Russia Working Out a Strategy of Affordability Improvement

The Central Bank of the Russian Federation is to develop a project of affordability improvement strategy for the next three years by November. The issue was discussed at the session meeting, devoted to affordability and consumer protection in the wake of new technologies development, as the Head of Service for Protection of Financial Services Consumers and Minority Shareholders Mikhail Mamuta said.
He stated that the project of a strategy is being developed in partnership with government entities, business representatives and non-governmental organizations and will be finished by 2017, when work on a road map that concerns establishing within the next two or three years a convenient system of access to financial services is scheduled to start.
According to Mikhail Mamuta, today Russia has a well-developed network of financial services in cities, whereas rural areas practically have no access to them. Thus when developing a strategy, the regulator lays emphasis on digital technologies that enable remote financial services. Though, another two important factors, financial literacy of the population and consumer protection, are taken into account to ensure a more successful affordability.
"On the one hand, people from a distant region should have a free access to financial services, which is important for them," noted the representative of the Bank of Russia. "Accordingly, the regulator's aim is to accurately identify and control potential risks, assuring secure use of the services for the customer."
Within the session, the necessity of achieving a balance between introduction of new tools, such as digital technologies that allow access to a larger number of services in the first place, and risks that occur when operating new services was debated.
In his speech, the member of the State Duma, President of Association of Russian Regional Banks Anatoly Aksakov asserted that it is essential that not only banks but financial institutions as well would pay attention to the financial education of people and their mental preparedness to the new technologies operation when introducing an innovation. According to Aksakov, people's distrust and unpreparedness for new services can turn any practically convenient channel into an impenetrable and unattractive one. In the run of discussion, the American research was also brought about, which suggested that six out of the first ten financial market phobias concern digital services.