In an earlier post we noted that Klickex would be attending the GPFI Plenary and Forum in Perth Australia on Financial Inclusion. The forum was held over the weekend of August 31 - Sept. 2nd. We can report that at this meeting a new report from the World Bank on the advantages of financial inclusion was reviewed. The report included ideas and suggestions from the Better Than Cash Alliance and the Bill Gates Foundation. Below are links to the report and a few quotes.
A few quotes:
"Integrating digital payments into the economies of emerging and developing nations addresses crucial issues of broad economic growth and individual financial empowerment, according to a new report by the World Bank Development Research Group.
The report examines, for the first time, growing evidence from around the world about how digital payments offer immediate benefits for both senders and receivers in developing economies, as well as the ability of such payments to increase citizen access to affordable financial tools."
"The Better than Cash Alliance and the Bill & Melinda Gates Foundation—which funded the study in support of the G20 Global Partnership for Financial Inclusion—emphasized the clear link between digital payments and the goals of G20 governments means that action should be swift and purposeful. The two organizations are urging governments, when they meet in November 2014 at the G20 Brisbane Summit, to discuss how they can embrace a broad-based digital financial system as a path to growth, greater participation of women in the economy, and greater access to payments, including remittances."
“We recognize that while the opportunities of digital payments abound, getting there takes work,” said Dr. Ruth Goodwin-Groen, Managing Director of the Better Than Cash Alliance. “Yet digitizing payments is achievable when a government articulates a clear vision, leads by example and provides the right incentives for the private sector to do what they do best: innovate, develop infrastructure and create products designed to succeed in the marketplace.”
The report and its implications will be discussed at the G20 Global Partnership for Financial Inclusion forum on September 1 in Perth, Australia.
The full World Bank study as well as the key findings and recommendations by the Gates Foundation and Better Than Cash Alliance can be found here.
And here is a link to a pdf of the Gates Report with the conclusion to the report pasted below:
As we have demonstrated, broader adoption of digital
payments—with regard to both remittances and other
payments—can significantly advance the global financial
inclusion agenda and support the priority areas of the Global
Partnership for Financial Inclusion (GPFI). Not only are digital
payments more efficient than cash payments, but their broader
adoption also can reduce rates of corruption and violent
crime, reduce the cost of government wage and social transfer
payments, offer new pathways into the financial system for the
disadvantaged, and, importantly, contribute to the ongoing
objective of women’s economic empowerment.
The international community must work with both
governments and the private sector to address the challenges of
digitizing payments in order to achieve the potential benefits,
especially when it comes to government “cash” transfers. These
challenges include generating up-front investment in payments
infrastructure, ensuring that recipients understand how each
cash-transfer program works, and taking steps to guarantee
reliable and consistent payments. It is also important that
consumers are educated on the basic interactions involved in
a digital payment ecosystem—using and remembering their
PINs, understanding how much money they should receive
at each payout period, and knowing what to do if something
goes wrong. Otherwise, recipients can lose trust in the system
and not use their accounts beyond withdrawing to collect their
government payment—and the broader financial inclusion
objectives will not be met.
Technology-enabled business model innovation can help build
inclusive financial sectors that enable people to improve their
lives. Governments, the private sector, and the international
community should focus on addressing the challenges of a move
toward making digital payments available to the billions of
unbanked adults around the world.
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my added comments:
It makes sense that Klickex would be invited to the forum where this was being discussed since they are a private sector leader in the technology to accomplish these tasks. When you read through the report you can see there is a lot of momentum and support for the type of technology that Klickex offers, but several challenges to get such a system up and running worldwide are also noted in the report. In other words, all this will take time even if a consensus to implement it is achieved on a widespread basis. Elements of it already exist on a regional basis in various places.
There is a lot of potential for all this to move forward and make major changes to how people use money and transfer it as well as how they save it (here the GSD might enter the picture). So we will just continue to follow it all and see where it leads over time.
Added note: There is a lot of emphasis on encouraging govenments to support an increase in the use of digital technology in all aspects of government.
Added note: Klickex Robert Bell is named a Top 25 "Innovator to Watch"
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