TOWARDS AN INTEGRATED DIGITAL ECOSYSTEM

Over 50 residents appeared at an impromptu town hall expressing their urgent need to access financial services during a November 2016 visit at the Meheba Refugee Settlement visit in Zambia.

UNCDF collaborated with four partners: UNHCR, the Ministry of Community Development, the Office of the Commissioner of Refugees, and MicroSave, to work towards making digital financial solutions a reality with the refugees and nine months later found some of the residents already had to move. Success does not come without challenges, but overcoming challenges to make finance work for those who most need it are worthwhile and UNCDF has a proven track record of doing so.

Financial inclusion and digital financial services (DFS) help people access energy, health, education, insurance in new ways, wherever they may be, that make these services more accessible and affordable. With overall, over 14 million financial inclusion clients served and over 45,000 government officials trained, UNCDF continues to make strides to make finance work for the poor, including these refugees who need it to get back on their own two feet. Working strategically with partners and sharing best practices are steps forward to create a viable sustainable digital ecosystem.

On October 5th, 2017, Xavier Michon, our Deputy Executive Secretary, shared UNCDF expertise of digital financial services at the Third Annual Conference of L’Afrique Digitale in Paris, France.

With an estimated quarter of the global population living in Africa by 2050, there has been a 344% rate increase in mobile equipment between 2007 and 2016 and further push to support the several emerging start-ups addressing the needs of the continent. The conference brought together stakeholders, entrepreneurs, and high-level speakers to share lessons learned and foster partnerships in efforts towards making Africa a global digital hub.

Moving beyond one aspect of digital finance

Focusing on just the services of telco operators is not enough. To make mobile money wallets functional and accessible to the largest number of people who are still financially excluded today, an array of conditions is needed.

When UNCDF has worked in LDCs that are at different stages of development and different stages of DFS, there has been substantial learnings in understanding what and how to make the markets develop.

Making Markets Work

UNCDF’s programme, Mobile Money for the Poor (MM4P) has identified key shifts needed for sustainable markets to take form and the challenges associated with it. The theory of change has driven the programme’s activities and allows it to monitor the progress delivered by its approach in eight countries.

Often after the “Inception” of a market, providers try to move from a “Start-up” stage and face the “sub-scale trap” that keeps them all from moving into market “Expansion” and “Consolidation”. MM4P acknowledges such critical points and hastens the transitions. When there were several disruptions in the mobile industry, UNCDF connected with other mobile network operators. When there was infrastructure put into place but slow customer adoption, UNCDF took a human-centered design approach. Now, MM4P currently has 68 ongoing projects in digital finance across eight countries in Africa and Asia and in eight months, hopes to include more communities like those refugees in Zambia.

Based on the most recent MM4P Annual Provider Survey, four of the programme’s countries are reaching or surpassing the 15 % threshold of active digital finance users. This situation presents an opportunity to see how UNCDF can use this reach to offer services that are of greater benefit to users and to focus more on underserved groups.

Providing access to financial services to underserved populations is a key enabler for at least 12 of the UN sustainable development goals. Because nearly over two thirds of the world’s 7.5 billion people have a mobile phone, digital financial services are becoming a gateway for those who have been historically excluded.

For more information, please contact:

Karima Wardak
Knowledge Management Associate
karima.wardak@uncdf.org
website: https://mm4p.uncdf.org