CGAP, Grameen Foundation, and MTN to invest in mobile money products for the unbanked
Date: Thu, 03/01/2012 - 18:11
Alex Counts, president and CEO of Grameen Foundation
Image credited to Grameen Foundation
At the Mobile World Congress 2012 in Barcelona, CGAP, Grameen Foundation, and MTN Uganda announced plans to introduce a new initiative to research and develop mobile financial products for the poor. CGAP, an independent policy and research center dedicated to advancing financial access for the world's poor, together with MTN and Grameen Foundation will provide US$1 million in financing to this initiative. The aim is to build upon the extensive research already conducted through Grameen Foundation's Application Laboratory (AppLab) in Uganda and to leverage MTN's successful Mobile Money service.
Access to financial services can help the poor smooth their income and invest in productive assets, education and health services. However, 2.7 billion people – most of whom live in developing countries – still do not have a bank account. This gap is due to two major challenges: Many low-income communities are underserved by financial institutions, and the products offered by these institutions are more suitable for higher-income clientele. The growth of mobile money is helping address the access issue, but there is still a need for product offerings that are appropriate for low-income consumers.
The goal of the initiative is to drive the next wave of innovation in the mobile money space by researching and developing products that are both appropriate for poor clients and commercially viable for the financial service providers involved.
"To achieve our goal of financial inclusion for all, the industry needs to move beyond mobile payments and provide a full array of pro-poor mobile financial products," said Tilman Ehrbeck, CEO of CGAP.
"This collaboration with CGAP and MTN Uganda will enable us to lead the next wave of product innovation to truly serve poor people's needs – a goal that is at the very core of Grameen Foundation," said Alex Counts, president and CEO of Grameen Foundation.
"MTN is committed to being innovative and relevant to its customers, particularly in this increasingly competitive global market. This partnership will ensure that we are able to address the needs of our customers in the rural market by enabling them to access otherwise inaccessible financial services. This in turn will ensure that the rural poor have better access to other social services, such as education, health and investment opportunities," said Themba Khumalo, CEO MTN Uganda.