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ILO suggests that we improve the policy environment to reap digitalization’s benefits in the financial sector.

ILO suggests that we improve the policy environment to reap digitalization’s benefits in the financial sector.

GENEVA (ILO News) – An adequate policy environment is needed to reap the benefits of digitalisation, concluded an ILO Technical meeting on the impact of digitalization in the finance sector (24-28 January 2022) that brought together representatives from governments, employers and workers to discuss the decent work challenges and opportunities in the financial sector.

Participants agreed that such a framework would create an equal playing field for traditional banks and insurance companies to provide decent and productive work in this sector as well as for new and developing tech companies.

The financial sector “makes a significant contribution to employment, and through financial inclusion, it fosters enterprise development, reducing the urban-rural divide, increases women’s economic participation and benefits SMEs,” said Juan Francisco Pozo, Government Group Vice-Chairperson.

The digitalization of the financial sector will allow for innovation and entrepreneurship to be supported and a smooth transition to a low-carbon economy. Furthermore, “The sector plays a key role across countries in promoting economic growth and pro-employment macroeconomic conditions. Digital finance also creates opportunities to develop better banking and financial products and services for consumers and creates new ways of channelling funding to businesses, thus improving financial inclusion,” said the Employers’ Group Vice-Chairperson, Giancarlo Ferrara.

The sector employs at least 52 million people. In 2020, at least 4.6 millions of these were young people. Young women account for 54.7 percent. Through access to finance and entrepreneurship, the financial sector facilitates job creation in all other sectors. This is a benefit for society as a whole.

Social dialogue can be a key tool for managing the digitalization impact and facilitating the introduction of new technologies. Therefore, “innovative structures for social dialogue in the face of changes in work organisation and protocols for a just digital transition should be promoted,” added Rita Berlofa, the Workers’ Group Vice-Chairperson.

Remote working and other arrangements must be facilitated to increase productivity, encourage job retention, foster decent work opportunities, and foster inclusion.

“The accelerated use of digitalization in the sector [also] calls for a discussion on the regulatory environment and other measures to address any negative impact of digitalization on the financial sector workforce, including issues around workers’ privacy, cybersecurity and data protection,” said Abdulla Murad Al-Mullahi, Chairperson of the meeting.

The pandemic highlighted the importance and importance of frontline workers and the importance sector for economic recovery and business continuity. It has also accelerated automation of work processes, as well as transformation of business models and organisation of work. These developments have implications on skills development, working conditions, occupational safety and health, as well as the impact on work-life balance and psychosocial risks.

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This meeting highlighted the importance of governments and social partners addressing these issues and coordinating with education institutions, training institutions, and the private sector to ensure that students are equipped with the necessary digital and professional skills.

The meeting also reached consensus on how to help workers, employers, governments and workers harness the full potential digitalization in the financial industry to create decent work, sustainable enterprise growth, and financial inclusion.

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