Press Releases:Is Africa’s financial industry ripe for digital disruption?

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By Daniel Monehin, Division President:
Sub Saharan Africa and Head of Financial Inclusion for International Markets at
Mastercard

Technology has the power to drive real,
impactful and inclusive change, particularly in the provision of financial
tools that allow greater numbers of people to be economically active and part
of the financial mainstream.
The financial industry is at a tipping
point: advancements in technology and increased uptake of mobile have seen the
sector increasingly move to a world beyond cash, where the potential to create
solutions that make payments faster, simpler and safer than ever before is
immense.
Digital disruption in the financial
service industry is inevitable, but is Africa ripe for disruption?
Research carried out by Deloitte on
leveraging digital in financial services in Africa shows the continent is
crying out for disruption – however, this will require waves of innovation. The
research reveals that the first wave – mobile
money –
 is paving the way for future innovations. According to
the World Bank, mobile money services contributed to deepening financial
inclusion in sub-Saharan Africa from 24 percent to 34 percent between 2011 and
2014. As mobile penetration continues to grow on the continent, the impact of
mobile payment solutions on fostering financial inclusion will also carry on
rising.
The second wave of disruption is leveraging the innovative
technologies
 from the first wave, while the third wave
is platforms –to
facilitate the convergence and aggregation of financial services. Developing
strong partnerships with players in the public and private sector, ranging from
mobile network operators to fintech companies, and harnessing tech capabilities
such as data analytics and cloud technology, are the key to embracing these
waves of change and implementing solutions that meet current and future needs.
Africa is undoubtedly a continent of
both challenge and opportunity: while its people remain hindered by a lack of
inclusion – the fact that only 34.2 percent of adults have an account serves as
stark testament to this – governments and companies are increasingly working to
ensure that this statistic is brought down and that all citizens benefit from more
accessible, effective and secure solutions.
In pursuit of this ideal, Mastercard
has dedicated extensive resources to partnering with market leaders and
developing solutions that not only meet the needs of the continent’s citizens
now, moving ahead into the future too. There are a number of tools that
Mastercard has rolled out across Africa in the last few months that have
already begun to make a tangible difference in people’s lives.
Perhaps the biggest example of using
technology in order to drive real and meaningful change in Africa is Masterpass
QR, the latest enhancement to Mastercard’s Masterpass digital solution.
Masterpass QR addresses challenges with the acceptance of electronic payments
in micro, small and medium enterprises.
Masterpass QR has proven to be a game
changer for MSMEs – widely recognised as core engines of development and growth
in Africa and other emerging market economies – and consumers alike. It removes
the dangers of carrying cash and guarantees the security and simplicity of mobile
payments, illustrating in a discernible way the capability technology has in
meeting needs at all levels of society. It is expected that Masterpass QR will
reach 100 million customers by 2020, truly showing the ability of mobile to
connect and empower.
In line with bringing greater numbers
of Africans into the formal financial fold, Mastercard has prioritised building
robust partnerships in the public and private sector, from governments to banks
and developers, in order to develop resilient solutions and tools that ensure
the widest reach.
There is an ever-increasing emphasis
being placed on conceptualising and implementing technology that drives
positive growth and momentum. This is one of the key pillars of how Mastercard
does business and what drives the company to keep delivering solutions that
drive widespread financial inclusion through the use of smart technology that
impacts and helps those citizens who require it most: the previously excluded,
unbanked and underserved.