WASHINGTON, United States, Saturday January 30, 2016 – The Inter-American Development Bank (IDB) has joined the Better Than Cash Alliance, a partnership of governments, companies, and international organizations that works to accelerate the transition from cash to digital payments in order to drive inclusive growth and reduce poverty.
Membership in the Alliance will contribute to further the IDB’s efforts to promote the financial inclusion of low-income people in Latin America and the Caribbean (LAC), with the aim of improving their economic security and enabling them to increase savings and assets by harnessing innovative payment technologies.
The new partnership will promote knowledge sharing and the development of digital payments ecosystems, by bringing together key public and private sector actors. These efforts will expand the access and use of quality and affordable financial products for previously excluded and underserved populations, and safeguard the stability of the financial system.
“We are delighted that the IDB has become the first regional development bank to join the Better than Cash Alliance, because we share the organization’s commitment to promoting financial inclusion as a way to reduce poverty and improve people’s lives,” said Bernardo Guillamon, manager of the IDB´s Office of Outreach and Partnerships.
The IDB has worked with a number of countries throughout the region to help them transition to digital payments for government transfers to low-income families.
In addition, the Bank has encouraged governments to use new technologies, such as tablets and ATM machines, to provide financial education and simplify bill-paying for consumers who previously did not have access to banking services. Such policies not only promote financial inclusion but result in cost savings and greater efficiency for governments.
The Multilateral Investment Fund (MIF), member of the IDB Group, through its Technology for Financial Inclusion Programme, TEC-IN, has partnered with more than 15 institutions in the region to develop business models—including the use of mobile technology and the development of merchant networks—to expand the access to payments, savings, and microcredit services, which for some individuals represent a first-time experience.
MIF’s partnership with a major telecommunication company in Paraguayhas allowed more than a million Paraguayans – over a quarter of the country’s adult population – to use their mobile phones to make person-to-person money transfers and pay for services. Through a country-wide network of merchants, they can also access cash and make deposits in a more efficient and secure manner.
“We are very pleased to welcome the Inter-American Development Bank to our Alliance,” said Dr. Ruth Goodwin-Groen, Managing Director of the Better Than Cash Alliance. “Its work has been a driving force in the promotion of digital payments and financial inclusion in the region, and particularly the work of the Multilateral Investment Fund is an example from which other regional development banks can learn. Most governments in Latin America and the Caribbean are realizing the incredible potential in the transition from cash to digital payments, led by Mexico, Peru and Colombia, which already are members of the Alliance.”