Global payment services firm MasterCard, together with the Bill and Melinda Gates Foundation, have announced a partnership to launch a new financial services innovation lab for entrepreneurs in East Africa.
According to the Gates foundation, around 2.5 billion adults worldwide do not have access to digital payment solutions and rely on cash which excludes them from the formal financial system and opens them up to a number of risks.
“Too many people lack access to the most basic financial services, leaving them trapped in a cash economy that imposes greater risks and costs on those least able to afford them,” said Ajay Banga, president and CEO at MasterCard. “Through the investment made by the Gates Foundation, coupled with our strong innovation processes, MasterCard will create and scale financial services that open up a world of inclusion and help people build better, brighter futures.”
With the help of an $11 million (around 112 million rand) grant from the Gates Foundation that will be provided over the next three years, the MasterCard Lab for Financial Inclusion will help local entrepreneurs, government and other stakeholders in the region to take new ideas for digital payment innovations from concept to reality, as well as tap into this market that may otherwise be commercially unviable.
R8 million will be reserved to for ideas that evolve to the incubation stage, to give each startup the best possible chance of reaching commercialisation at scale and becoming a vital part of a new economy.
“The work done at the MasterCard Labs for Financial Inclusion will lead to new products and services for poor people that leverage existing and new infrastructures, including those that are not specific to MasterCard,” MasterCard said in a statement. ”
The lessons from the MasterCard Labs for Financial Inclusion will be distributed for the public good, and all products and services coming out of the Lab will make use of standards ensuring maximum flexibility to empower local financial service providers for the benefit of poor people in the developing world.”
[Image – MasterCard]