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The United Nations Secretary General’s Task Force on Digital Financing of the Sustainable Development Goals (SDGs) released a report on Wednesday highlighting the historic opportunity to accelerate and expand the transformative impact of digitalisation in financing the SDGs. The report spells out how digital finance can be harnessed in ways that empower citizens.

According to the report, titled “People’s Money: Harnessing Digitalization to Finance a Sustainable Future,” over half the world’s population is online, a one hundred-fold increase since 1990. Mobile payment technologies have transformed mobile phones into financial tools for more than a billion people. Digitalisation is supporting big data and artificial intelligence in advancing cryptocurrencies and crypto-assets, peer-to-peer lending, crowdfunding, and other online marketplaces.

The Task Force was established by the UN Secretary General, António Guterres, to recommend ways to harness digitalisation in accelerating financing of the SDGs. It is co-chaired by Achim Steiner, United Nations Development Programme (UNDP) administrator, and Maria Ramos, who was until recently CEO of ABSA Group. The Task Force comprises leaders from across finance, technology, policy, regulation and international development. The report was launched today in New York City by Guterres and the two Task Force co-chairs.

“Digital technologies, which are revolutionizing financial markets, can be a game-changer in meeting our shared objectives," said Guterres. “The Task Force on Digital Financing of the Sustainable Development Goals provides leadership to harness the digital revolution.”

The unprecedented social and economic crisis caused by the COVID-19 pandemic has made digitalisation far more important, as digital finance has become a critical lifeline during the crisis for billions of people. During the still-raging crisis, the UN report said digitalisation has been harnessed to support vulnerable people, reduce inequalities, sustain livelihoods and strengthen solidarity.

Among the opportunities highlighted by the report, the Task Force said digitalisation can be harnessed to channel the $23.3 trillion in global domestic savings into investments in sustainable infrastructure. The report said digitalisation is empowering savers, lenders, borrowers, investors, and taxpayers. Digitalisation can also help in informing citizens on how to link their consumer spending with the SDGs.

According to the report, digitalisation can increase the effectiveness and accountability of public finance. The International Monetary Fund (IMF) has estimated the value from digitizing government payments in developing countries at $220-$320 billion annually or 1.5 per cent of revenues. Switching from cash to electronic delivery of government services generates roughly 40 per cent in savings per transaction.

The Task Force, however, cautioned that, if unchecked, digitalisation could deepen exclusion, increase inequality and further divide people. Hence, barriers, including inadequate digital infrastructure, lack of access and affordability as well as digital risks such as gender and minority biases, need to be addressed. The report said the UN can play a key role by helping member countries in realizing opportunities, overcoming barriers and mitigating risks.

"For digitalisation to be a true force for delivering on the Sustainable Development Goals, technological advances must combine with sound policy that empowers citizens and enables our financial system to meet the urgent investment challenges that must be overcome to build forward better,” said Steiner.