MasterCard has expressed its expectations Digital Financial Services lab recently launched in East Africa with funding from the Bill & Melinda Gates Foundation.
In a telephone chat with Nigeria CommunicationsWeek, Daniel Lanre Monehin, division president, Sub-Saharan Africa at MasterCard, said although the lab comes up in East Africa, MasterCard will ensure innovations and applications developed therein be used to leapfrog financial inclusion in the African Continent.
Globally, digital payment innovations let more people take advantage of formal financial services. These tools are simple to use, efficient and have the potential to dramatically reduce costs.
Despite these innovations, there are still 2.5 billion adults around the world who are excluded from the formal financial system. These people lack access to basic financial services and are forced to rely on cash, which creates instability and significant risks.
MasterCard is notable as a leading global payments solutions company that provides a family of well-known, widely-accepted payment card brands including MasterCard, Maestro and Cirrus and serves consumers, financial institutions, and businesses in over 210 countries and territories worldwide.
Monehin said that the new initiative seeking to impact more than 100 million people even globally, by developing practical and cost-effective financial tools that expand access and help build stable futures over the long term.
Specifically, the Divisional President said that Africans fates are now in their hands, hence MasterCard is interested in tackling issues related to biometrics, pensions, e-payment and cashless economy policies, and bring the financially excluded into the system.
He reiterated that through an $11 million grant over three years from the Bill & Melinda Gates Foundation, the lab will generate new ideas with local entrepreneurs, governments and other stakeholders across East Africa, and rapidly move from concept to reality.
“Although the lad is launched in East Africa, but the innovations coming from there will not only be implementable in East Africa, or Africa, rather MasterCard is interested in addressing several critical financial inclusion challenges. Every economy has its peculiar challenges; what we want is for Africans to develop applications that will serve the people and bring the financially excluded on-board,” Monehin said.
While expressing confidence on the viability of the project, he cited the South African Social Security Agency (SASSA), one of the world’s first debit card-based payment systems for welfare benefits and social security, which has saved the country $350million over a five-year period.
He said, “MasterCard is passionate about the new innovation and we draw our inspiration, again, from the SASSA project in South Africa where the debit card issued to the citizens serves multiple purposes. Today, South African uses the card to disburse government pension, disability, and public assistance payments because of its biometric-debit card composition.
“Unlike normal debit cards, the South African cards require users to have their fingerprints and voices digitally analyzed by computers. In effect, they’re the next generation of the EBT cards commonly used for food stamps in the United States”.
In Nigeria, he said, MasterCard is passionately involved in the management of payments account specific information under the ongoing national identity management scheme, and hopes “the Card when activated will help in bring about 70% of the financially excluded Nigerians in the banking system; deepen e-payment and help in the disbursement of pension”.
Expatiating on the payments technology deployed by Mastercard under the program, Monehin said the eID card is a chip and pin card certified according to the EuroPay, Mastercard and Visa (EMV) standard for globally interoperable, secure payments, which is mandated by the Federal Government, and it is approved and licenced by the CBN.
Thus, MasterCard’s vision for setting up the digital financial service lab was geared towards addressing issues where, “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.
He added that the investment made by the Gates Foundation, coupled with MasterCard strong innovation processes, they will create and scale financial services that open up a world of inclusion and help people build better, brighter futures.
Daniel who is primarily focused on establishing the MasterCard brand presence, driving card issuance, increasing acceptance, deploying innovative solutions and partnering with market regulators, noted that the new lab will be part of MasterCard Labs, MasterCard’s global Research and Development division that focuses on the evolution of technological and consumer trends and has created hundreds of prototypes over the last several years in a variety of areas from payment acceptance to authentication to P2P payments.