IFC, The MasterCard Foundation Event Explores Financial Inclusion in Africa
Financial inclusion has made remarkable strides in Sub-Saharan Africa in recent years, due largely to advances in technology and mobile banking. Yet challenges remain. A recent event hosted by IFC and The MasterCard Foundation sought to find out how these are best tackled.
Following the transformational success of M-PESA in Kenya, the market for affordable financial services in Sub-Saharan Africa now attracts interest from microfinance institutions, and from larger banks, mobile network operators, payment service providers and innovators.
The potential for financial inclusion is clear. In just four years, the rate of formal financial inclusion in Tanzania has more than tripled from 16 percent of the adult population to 58 percent on the back of mobile money services.
But opportunities obscure challenges. No single industry deployment in Africa has yet been able to replicate the success of M-PESA.
In late May 2014, The Partnership for Financial Inclusion, a joint $37.4 million program by IFC and The MasterCard Foundation to expand microfinance and advance mobile financial services in Africa, brought key stakeholders in the regional industry together with Partnership clients at an event in Johannesburg to explore recent developments and possible routes ahead.
“There is a fundamental paradigm shift in how people are using financial services in Africa, and that is now driving how traditional financial sector providers are responding. Mobile money has had an impact on card companies, on banks and insurance companies, and on microfinance,” said Greta Bull, Program Manager of the Partnership.
The discussions that followed at the two-day event focused on developments in alternative delivery channels and business models for growth, as well as regulation and innovation. Debates brought together a wide range of views from the industry.
On the vision for the future, Godwin Ehigiamusoe, CEO of Nigerian microfinance bank LAPO, said, “There will have to be collaboration. I see microfinance banks like mine linking up with big actors in the mobile money sector.”
Ignacio Mas, independent consultant on mobile financial services, said “I think it’s not possible to overhype the potential of mobile money. What you can easily overhype is the progress we have made so far against the vision. We know what the future will look like, but it’s not clear how quickly we will get there, who will take us there, and how.”
To hear more of what the participants at the event had to say on the future of financial inclusion in Africa, please watch the interview videos from the event here.
For more information, please contact Anna Koblanck, Communications Officer for the Partnership for Financial Inclusion: firstname.lastname@example.org