MasterCard announced, with a $1.5 million grant, that it is joining the Better Than Cash Alliance. MasterCard’s commitment comes at the one-year anniversary mark for the Better Than Cash Alliance, which works with governments, the development community and the private sector to digitize their cash payments to people in emerging economies. The initiative for electronic payments was founded last year by the Bill & Melinda Gates Foundation, Citi, Ford Foundation, Omidyar Network, USAID, U.N. Capital Development Fund and Visa Inc. MasterCard joins the Alliance as the first funder since the original commitments announced at launch.
“MasterCard is excited to join the Better Than Cash Alliance to help educate and engage the public on the cost of cash to society which can be as much as 1.5 percent of a country’s GDP,” said Ann Cairns, President, International Markets at MasterCard. “Electronic payments have been proven to boost economic growth and accelerate financial inclusion – but we recognize that to move the needle, businesses, governments and NGOs need to work in partnership.”
Every year, billions of dollars in cash payments are made by governments, the private sector and development organizations to millions of poor people. The Better Than Cash Alliance launched in September 2012 in response to public and private sector demand for more strategic advocacy, research and guidance on how to transition these into electronic payments.
Shifting away from cash provides a pathway to greater financial inclusion for the 2.5 billion adults currently without access to formal financial services, and has measurable benefits for governments, development organizations and private sector payers including significant cost savings, transparency, security and economic growth.
“We are excited to welcome MasterCard as a supporting member of the Better Than Cash Alliance,” said Ruth Goodwin-Groen, Managing Director of the Better Than Cash Alliance. “We welcome not only their financial contribution, but particularly their electronic payments expertise they bring to the partnership in support of emerging economies transitioning to digital payments and improving lives around the globe.”
Financial inclusion is a key driver for MasterCard Worldwide’s participation. Cash-only economies make it extraordinarily difficult for people to access financial services such as payments, savings, credit or insurance. Electronic payments can create lasting benefits for people by creating opportunities to access formal financial services and begin to develop assets and save for the future.
In the one year since its launch, the Better Than Cash Alliance has made significant progress, including securing 14 commitments from governments and development organizations to digitize their payments. These include the Republic of Malawi, the Department of Social Prosperity of the Government of Colombia, the Republic of Afghanistan, the Republic of Kenya, the Republic of Peru and the Republic of the Philippines.