Remarks by UNCDF Executive Secretary on the occasion of Leveraging Digital Innovation in Humanitarian Response to Build Resilience

  • May 24, 2016

  • Istanbul, Turkey

Ladies and gentlemen,
Distinguished co-hosts and

It is my great pleasure to welcome you here today on behalf of the United Nations Capital Development Fund, along with our co-hosts, MasterCard and the Consultative Group to Assist the Poor, or CGAP, to this side event today on “Leveraging Digital Innovation in Humanitarian Response to Build Resilience” at the World Humanitarian Summit.

Why are we here, talking about “digital innovation” in the context of crises? Aren’t there more urgent matters of food, shelter, and water? These are not as disconnected as some might think, for digital delivery of cash, in the right contexts, can be the fastest, safest, and lowest cost way to enable people to get the food, shelter, and water they need.

As the Secretary-General made clear in “Agenda for Humanity,” resilience and self-reliance should be at the center of the approach, and cash-based programming can both support the agency of people affected by crises by allowing them to purchase the goods and services they most need, while at the same time helping to revive local markets and economies.

Yet cash-based programming using physical cash does not go far enough. Many of the challenges associated with in-kind assistance are also issues for physical cash: the risks associated with carrying cash, the potential for corruption along the way, the chance of going to the wrong person, the delays associated with transporting cash, and the additional costs of cash. There are a range of digital systems—whether via mobile phones or pre-paid cards or other technologies—to get money into the hands of people who need it the most, and to do so quickly, securely, and in-full. When done well, this can be an effective and powerful way to enable people to get what they need when they need it. When it is linked to broader systems—whether bank accounts or other stores of value or broader social protection programs—it can lead to greater financial inclusion and enable people to start moving from response to resilience.

This does not happen automatically, however. We need to make deliberate choices—in times of crisis and better yet, in times of relative stability. For people to be able to access digital money, they need to have a way to establish their identity. For people to be able to use digital money, it must to be accepted in exchange for the things that people need to buy. For this to be possible, appropriate regulations are required and the basic infrastructure must be functioning. The best way to ensure this, is to build it before crisis hits as a part of preparedness.

Finally, and, critically, the products and services must be designed and delivered in ways that those affected want and need.

We are all here today because we share these concerns about the impact that crises have on people and the planet. And furthermore, we are here together because of our commitment to minimize those risks, to maximize the efficacy of our response, and to ensure that we are laying the foundations for greater resilience. Today we will have the opportunity to learn about how—and to hear about examples—in Sierra Leone, Nepal, and beyond—where such innovations have made all the difference. We will hear about what are some of the pre-conditions and how they can be addressed, what are some of the enablers and how they can be put in place, and what are some of the challenges and how they have been overcome—and in so doing, identify ways these lessons can be applied more broadly as the global community answers the call to bridge the humanitarian-development divide.

At UNCDF, such approaches are central to our work. The UN General Assembly has asked us to work first and foremost with the forty-eight Least Developed Countries. It is not by chance that there is such a high correlation between countries that are afflicted by disasters—whether natural or man-made—and countries that fall into the category of “Least Developed.” We use our capital mandate and instruments to offer “last mile” finance models where they are most needed: where resources for development are most needed, where market failures are most pronounced, and where benefits from national growth tend to leave some people out. This is nowhere more true than where disasters strike.

Our co-hosts share these pre-occupations.

Housed at the World Bank, the Consultative Group to Assist the Poor, is a leader in innovative research that advances our joint efforts on financial inclusion. CGAP is particularly focused on ways that digital finance can extend formal financial services to low income people, particularly in ways that identify and mitigate associated consumer risks. CGAP is a membership organization and UNCDF is honored to be among its 34 members.

I now have the pleasure of introducing another co-host, Walt Macnee, Vice Chair of MasterCard. He is responsible for engaging these corporate, government and civil society stakeholders on key issues related to the ever-changing payments industry and steering the company’s strategy. Part of this is a strong corporate commitment to deploying their know-how and networks to humanitarian and development solutions that contribute to greater financial inclusion. Walt, allow me to hand it over to you.