Zuckerberg’s Testimony Paints Libra As Financial Inclusion Tool

Facebook CEO Mark Zuckerberg testified before the United States House Of Representatives Committee on Financial Services on Tuesday (Oct. 22). He spoke about the company’s intentions with Libra, and sought to assuage the concerns of regulators and legislators around the world that the currency could be used for illicit purposes, or replace sovereign currency.

“There are more than a billion people around the world who don’t have access to a bank account, but could through mobile phones if the right system existed,” he said. “This includes 14 million people here in the U.S. Being shut out of the financial system has real consequences for people’s lives — and it’s often the most disadvantaged people who pay the highest price.”

Zuckerberg said he wants to bring these people into the financial ecosphere by making the sending of money as “easy and secure” as sending a text. He said the Libra will be a global payments system that is fully reinforced by cash and other liquid assets. He also cited studies showing that allowing for inclusion into the financial system helps pull people out of poverty, and how women in developing countries especially need this type of unencumbered inclusion to financial access.

He said the company is aware of the regulatory concerns, as well as the concerns about money laundering or the use of the system for illicit means. Those things need to be addressed, he noted.

“Some have suggested that we intend to circumvent regulators and regulations. We want to be clear: Facebook will not be a part of launching the Libra payments system anywhere in the world unless all U.S. regulators approve it,” Zuckerberg said.

He added that he would support a delay until U.S. regulatory concerns are met.

“The Association has been focused on regulators and other stakeholders,” he explained, “but Association members — including Calibra, Facebook’s Libra-related subsidiary — are also talking with elected officials, including many here in Congress. This is how democratic oversight and scrutiny should work.”

He also reiterated that Calibra will be a completely separate entity from Facebook, and have a different leadership makeup. Data won’t be sold, shared or used to make money, he said.