EDITOR’S QUESTION
HOW ARE DIGITAL
PAYMENTS IMPACTING
AFRICAN BUSINESSES
AND WHAT IS THE NEXT
STEP IN PREPARING FOR
A CASHLESS ECONOMY?
Mastercard is a committed
contributor to Africa’s digital
payment landscape. The company
has recently been reinforced as
a technology partner for the
Government of Rwanda in the
drive for a cashless economy and is
responsible for the implementation
of many innovative payment
technologies in the region,
including biometric cards and
Masterpass QR. Mastercard
MEA President, Raghu Malhotra,
discusses how innovation is driving
financial inclusion in Africa.
Disruption is a process. Over the last
few years, Africa has demonstrated its
ability to pioneer payment solutions
that have the power to effect large-
scale and pervasive change that drives
inclusive growth. It didn’t happen
overnight – through concerted efforts
and committed partnerships between
the public and private sectors, numerous
African countries have been able to
introduce more accessible digital
financial tools that facilitate greater
levels of inclusion and economic
involvement. Mobile money applications
have been (and still are) one of the most
successful drivers of financial inclusion
on the continent. Digital finance
solutions have the capacity to lower both
operating costs as well as the barriers to
access formal financial infrastructure.
Africa is a beautiful case study in and
of itself, especially when you consider
the significant ground the continent
had to cover to keep up with global
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developments. According to the World
Bank’s Global Findex financial inclusion
data, 34.2% of adults in sub-Saharan
Africa have a bank account – nearly
half of the global average of 62%.
However, evaluating the same subset
of the population reveals that 45% of
these individuals have a mobile money
account, compared to the rest of the
world coming in at 2%.
As developers of safe, secure and
convenient mobile payment solutions, it
is heartening to see the role that digital
and mobile can play in this space – and
how many governments, businesses,
financial institutions and innovators
have taken up the challenge to harness
the immeasurable potential of digital
finance. But again, disruption is a
process. It’s a long-term game. Much
like Africa has achieved the impressive
milestones it has in a few short decades,
innovators in this space have to be in it
for the long haul. More importantly, they
have to be connected to their customers.
Mastercard has made a long-term
commitment to Africa. We want to
connect 30 million of its denizens to the
formal financial infrastructure in their
respective markets. We don’t do this
in isolation, we do this in partnership
with private organisations, NGOs and
governments alike. It is only through
continuous partnership and innovation
that effective solutions can be created
and rolled out at scale. Mastercard
recognises this and strives to work with
trusted partners in the public and private
sectors in order to conceptualise and
implement tools that empower Africans
in a real and measurable way.
A particularly important example of this
kind of partnership in innovation was the
agreement signed between Mastercard
and the Rwanda Development Board
at last year’s WEF Africa meeting in
Kigali. The agreement focused on the
digitisation of government services –
specifically in the areas of school fees
and national healthcare claim payments
– an online payment gateway for
RwandaOnline, an interoperable mobile
banking platform and the management
of cross-border spending.
Because of the success achieved in
providing an online payment gateway
for RwandaOnline – called Irembo
– Mastercard and the Rwandan
government have extended their
partnership in order to bring greater
numbers of the country’s citizens into
the financial mainstream by making
the ways in which they receive and
make payments to and from the
government more simple and secure.
The implementation of this solution is a
major driver of the government’s Vision
2020 strategy, which aims to build a
cashless society where at least 90% of
the population are financially included.
It’s not only in Rwanda that real and
useful solutions are being introduced,
though. Innovation is put into action
every day across the continent, helping
more unbanked and underserved
Africans in a meaningful way. Disruption
is, and always will be, a process.
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