- Extends effort beyond 500 million financially included over the past five years
- Partnerships with iKhokha and uKheshe in South Africa enable small, micro and medium enterprises (SMMEs) to accept digital payments
Johannesburg, South Africa – 18 May 2020: In this time of crisis, Mastercard has expanded its worldwide commitment to financial inclusion by pledging to bring a total of 1 billion people and 50 million micro and small businesses into the digital economy by 2025. As part of this strategy, the payments technology company will focus on providing 25 million women entrepreneurs with solutions that can help them grow their businesses.
The impact of COVID-19 has made it even more pressing to support inclusive growth in developing economies like South Africa, which according to the World Bank, is forecasted to have more than one million people pushed into extreme poverty due to the pandemic.
“The health and economic consequences of COVID-19 have highlighted the critical need to support vulnerable populations, many of whom are disproportionately impacted. If we are going to recover in any sort of long-term, sustainable way, we have to ensure that everyone is included in the digital economy. Financial inclusion is a critical part of that goal,” says Suzanne Morel, country manager at Mastercard, South Africa.
In South Africa, 11 million people are unbanked or under-banked, with 65 percent of all retail payments made in cash, locking merchants and consumers into unnecessary risks and high transaction costs. A Mastercard study showed that the cost of cash for consumers is R23 billion per annum or 0.52% of South Africa’s gross domestic product (GDP), with the majority of this cost carried by lower income earners.
Over the past five years, Mastercard achieved its initial goal of including 500 million people in the digital economy through more than 350 innovative programs across 80 countries.
In South Africa, Mastercard has partnered with fintechs like uKheshe and iKhokha and other financial services providers to offer low cost digital payment solutions to SMMEs and the unbanked to fast track financial inclusion. With a large percentage of SMMEs, traders and service providers still transacting in cash, Quick Response (QR) code solutions like Masterpass provide an affordable way to accept digital payments and grow their businesses, as there are no prohibitive infrastructure or maintenance costs associated with physical card terminals.
Mastercard has also partnered with Junior Achievement South Africa to help equip young women with the skills to start and grow their own businesses, and instill the discipline of earning a living, saving, spending and investing.
“Reaching the one billion goal will require collaboration and partnerships with a wide range of players, including financial services providers, fintechs, mobile network operators, government, retailers and others. In partnership with both the public and private sectors, we look forward to developing commercially-sustainable and scalable solutions that will help society-at-large thrive,” said Morel.
This announcement builds on Mastercard’s ongoing efforts to support an inclusive recovery by leveraging the company’s technology, capabilities and reach. That work includes:
- In the first weeks of the global health crisis, Mastercard committed up to $25 million in seed funding to establish the COVID-19 Therapeutics Accelerator in partnership with the Bill & Melinda Gates Foundation, Wellcome, The Chan Zuckerberg Initiative and others to help speed up the response to the COVID-19 epidemic by discovering, developing and scaling-up treatments for deployment around the world.
- Mastercard has committed $250 million in financial, technology, product and services support over the next five years to small businesses in many markets where it operates, supporting the vitality of businesses and the financial security of their workers.
- Mastercard is leveraging its network to provide support to governments around the world in a range of areas. This includes providing data insights to inform policymakers about the economic impact of the pandemic; increasing the speed and efficacy of aid disbursements to communities and business segments that need it most; developing donation platforms to enable emergency fundraising; and working with governments to assist business owners and consumers with cyber vulnerability assessments.
About Mastercard Incorporated (NYSE: MA), www.mastercard.com
Mastercard is a global technology company in the payments industry. Our mission is to connect and power an inclusive, digital economy that benefits everyone, everywhere by making transactions safe, simple, smart and accessible. Using secure data and networks, partnerships and passion, our innovations and solutions help individuals, financial institutions, governments and businesses realize their greatest potential. Our decency quotient, or DQ, drives our culture and everything we do inside and outside of our company. With connections across more than 210 countries and territories, we are building a sustainable world that unlocks priceless possibilities for all.
Mastercard Communications Contact:
Birgit Deibele – birgit.deibele@Mastercard.com
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