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Beyond the Transaction: Every Transaction Has a Story

Inclusive Growth: Cash Is Still King, but It’s About to Be Dethroned

Editor’s Note: At the World Economic Forum, MasterCard CEO Ajay Banga led a public session on Inclusive Growth in the Digital Age. We are hosting an Inclusive Growth series on our blog, inviting others to share perspectives.

At the Financial Inclusion 2020 Forum in London, I sat with global leaders, bankers and other financial inclusion practitioners as MasterCard’s CEO Ajay Banga reminded us why “cash is the enemy of the poor.”  Unfortunately cash still reigns supreme in many parts of the world, but thanks to advances in mobile technology, its throne may soon be up for grabs.

original filename: Mercy Corps - Ouallam, Niger, February 2014-0170.jpg

More than 2.5 billion people still rely on physical cash for their economic needs –buying food, paying bills or sending money. Digital transactions would not only reduce the costs of these exchanges, but also unlock a world of financial products and services.

My organization, Mercy Corps, works in over 40 countries, home to a majority of the world’s poorest people and among the world’s most fragile states. Development organizations like Mercy Corps connect people to the global economy and help governments and the private sector clear barriers to reaching these “last mile” customers.

While many challenges stand in the way, there are two we can start to fix right away:


Not having a unique identification card keeps people from accessing financial services, and the majority of people who lack IDs are poor. There are new efforts to remedy this problem. For example, Nigeria’s National Identity Management Commission, in partnership with MasterCard, plans to issue National Electronic ID cards to Nigerians ages 16 years old and older, approximately 120 million people (70 percent of the population). As part of this program, they will also have access to electronic payments and savings.


Countries with the highest poverty rates and highest dependence on cash tend to have the weakest infrastructure, making it hard to connect people to digital financial services. In a recent study funded by MasterCard, Mercy Corps evaluated the costs of providing electronic cash transfers to people fleeing conflict in the Democratic Republic of Congo. The study, Cheaper, Better, Faster, found that cash was still far less expensive and easier to administer than mobile money in certain environments, mainly because of limited wireless infrastructure and nascent mobile-money networks.  It’s a good reminder that digital services can’t expand faster than the infrastructure they run on.

I believe that the next few years will bring a major shift as more people join the global digital economy. When that happens, King Cash had better look out.