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The Power of Remittances to Transform Inclusion

In our meeting earlier this year with the president of the African Development Bank, the number one topic on his agenda was remittances. The impact of remittances on the economies of Africa is large. 20 – 30 million African immigrants send approximately $40 Billion USD back to their families and communities every year.  Digital payments can help, and in fact are helping, make that process simpler, safer, smarter, and more cost effective. This means more money reaching families back home in Africa who need it most.obama

At the US-Africa Business Forum today, U.S. President Barack Obama referenced the latest example of Mastercard helping improve the remittance corridor in Africa with the expansion of HomeSend into Ethiopia. Working with the Commercial Bank of Ethiopia, this partnership brings remittance services to more than 100 million people in the East African country and allows people to easily send funds directly to any mobile number in Ethiopia. More importantly, it provides access to a safe and convenient financial solution, bridging the gap for the 78 percent of adults in Ethiopia still excluded from the formal financial sector.

The partnership in Ethiopia joins an effort already underway to transform remittances across the continent including in countries like Democratic Republic of Congo, Ghana, Mozambique, and Zimbabwe.

But our effort extends well beyond remittances. We know how becoming financially included can transform economies and lives. Families now receive government social payments on a Mastercard prepaid card in South Africa. Women are enrolling and receiving their first form of government issued identification in Nigeria that also includes payment functionality. These programs have the potential to empower people and bring greater security and dignity. In fact, McKinsey just released a new report today that cites the potential to provide access to financial services for 1.6 billion people in emerging economies, more than half of them women.

At Mastercard, we’ve committed to helping connect 500 million people by 2020 and to date have already connected over 200 million through programs and partnerships with governments in Africa and around the world. We have also pledged to bring 40 million micro and small merchants onto our network in the next five years because these are where most of the underserved shop each day.

We are doing all of this in partnership with governments, banks, telcos, the development community and other invested stakeholders, because only together can we create a sustainable impact in real and tangible ways.