GoodDollar
GoodDollar is both the name of an Israeli cryptocurrency and a not-for-profit company launched in 2020. Cryptocurrency is an immaterial system of money that has secure coding. Additionally, people can exchange it virtually and governments do not control it. Yoni Assia is the mind behind the GoodDollar project and coin (G$), the virtual currency that intends to democratize the economy by working to promote universal basic income and reduce inequality. Universal basic income (UBI) is “a periodic cash allowance given to all citizens… to provide them with a standard of living above the poverty line.” Here is some information about how GoodDollar promotes universal basic income (UBI).

GoodDollar’s Mission

According to Forbes, 80% of the population owns only 6% of the world’s wealth, while the remaining 20% owns the rest. Against this unfair backdrop, GoodDollar is a potential game-changer through how it promotes universal basic income.

Yoni Assia believes that “too many underprivileged people are locked out of opportunities that could take them out of poverty, including access to capital markets and digital work opportunities. Therefore, the GoodDollar project aims to alleviate that by fostering financial inclusion and empowerment around the world.” The creator of GoodDollar is also the founder of eToro, a social trading company and platform, which is responsible for investing $1 million in the new cryptocurrency.

How GoodDollar Works

GoodDollar can benefit anyone who signs up and creates an account (a wallet). For that, people need to record a short video to ensure that they are real humans, not bots, and they can complete the entire sign-up process in less than 5 minutes. There are two groups of users, claimers and supporters. Claimers are people who benefit from free digital cash (G$) without the need to invest any amount, being allowed to claim it every day and use it to pay for goods, services and exchange it with friends. Up to now, 255,000 claimants have received G$180 million, totaling more than $20,000. Supporters are both companies or regular people that believe in the UBI cause and fund a mechanism that generates interest (the DeFi — decentralized finance, protocol).

Interest generates in a blockchain, a kind of extremely safe digital information record system, and becomes the reserve of G$ coins to that undergoes distribution among claimers and supporters. The supporters benefit not only from the interest generated by their initial staked amount, but also the interest generated on top of the previous interest rate. Currently, only small businesses accept G$ coins, and they are not very valuable. However, as more people join the GoodDollar movement, its value will rise.

Hope for GoodDollar’s Growth

“Inequality plagues the world. Let’s solve for it in our future,” is a statement on GoodDollar’s website. The company is still in its early stages, but getting ready to release version 2.0 of the GoodDollar protocol. In the first year of the second version, it plans to distribute around $47,000 worth of G$. AI Multiple’s review on GoodDollar points out that, to grow and make a real difference in its users’ lives, GoodDollar needs to have more supporters and a G$ reserve that grows “faster than the number of claimers.”

The more people use this cryptocurrency, the more valuable it will become. If “a public figure sheds a light on it via their social media platforms or accepts it as a payment method for a business product or service, that could boost its popularity.”

A Promising Future

The Forbes article discusses how basic income distribution could help to reduce the financial inequality that the pandemic exacerbated, and the GoodDollar team has been working hard to make it a reality someday. While the future of the project depends on a combination of factors, blockchain solutions like GoodDollar are undeniably promising and revolutionary economic models.

Tal Oron, GoodDollar project director, hopes that within a few years, “GoodDollar [will distribute] $2 a day per person, and, together, as a global community, without government support, raise hundreds of millions of people above the poverty line.” The way that GoodDollar promotes universal basic income will only benefit people globally.

– Iasmine Oliveira
Photo: Flickr

AkoinYoung entrepreneurs in Africa face unique obstacles when starting their own businesses, which prolongs Africa’s development. Akon, the multi-platinum-selling singer and recording artist, is originally from Senegal in Africa. Therefore, he has a deep understanding of the economic strife facing Africa due to inflation and financial instability. On top of this, about 350 million adults in sub-Saharan Africa remain unbanked, equivalent to 17% of the world’s total unbanked. Akon aims to change this by introducing the Akoin cryptocurrency.

Why Akoin?

Akon is using blockchain technology to help African entrepreneurs. He seeks to provide them with the tools necessary to overcome the difficulty of working between more than 40 currencies across 54 African countries by uniting currencies. With the Akoin cryptocurrency, seamless transfers within and across borders could be possible.

In the early months of 2021, the youth of Senegal took to the streets to protest the economic instability and unemployment facing their generation, highlighting the need for a new economic recovery plan. Although the economy in Senegal has grown in recent years, the growth has not always meant growth in jobs for young adults.

Akon is aggressively seeking to reach his goal of implementing Akoin in Africa because “[i]t brings the power back to the people and brings the security back into the currency system.” The singer-turned-social rights advocate seeks to implement Akoin as a form of payment to provide users access to a suite of business tools. Additionally, the construction of Akon City has been approved by the Senegalese government. Construction will take an estimated 10 years with the cost of this futuristic city being an estimated $6 billion, supported by Akon and other investors.

How it Works

Akoin, the African cryptocurrency token, is part of a decentralized exchange ecosystem that allows users to trade tokens and other cryptocurrencies between each other or major exchanges. After making this technology accessible to emerging entrepreneurs and helping them with the extensive paperwork required by banks when starting a new business, Akon could strengthen the African economy with a stronger infrastructure for startups.

Unlike other cryptocurrencies, Akoin is specific to Africa and seeks to provide optimal support as a transaction medium in otherwise hard-to-reach areas. One major obstacle to the African adoption of cryptocurrency as tender is government uneasiness. Signs show that the wariness of another legal tender remains, potentially due to a lack of public knowledge and the possible insecurity that comes with blockchain technology’s anonymity.

Looking Foward

With Africa awaiting a crypto boom, Akon makes the clarification that Akoin does not necessarily need to be deemed legal tender, only an “alternative financial solutio[n].” According to Chainalysis, a blockchain analytics firm, South Africa, Kenya and Nigeria are ranked among world leaders in peer-to-peer crypto transactions. Mwale Technological and Medical City have beta-tested the transaction platform. More than 2,000 merchants utilized the technology as the “sole currency and payment processor.

Hope remains for the Senegalese government’s adoption of Akoin. Leaders of the African cryptocurrency scene are hopeful for more African countries to adopt and primarily benefit from the plethora of crypto applications.

– Melanie Goldsmith
Photo: Flickr

National Payments System in SomaliaThe Somali government recently secured support from the International Monetary Fund (IMF) and World Bank to create a central payments system that will aid in rebuilding Somalia’s economy. Millions of Somalis have suffered for the preceding two decades as a result of insufficient economic infrastructure. The combination of economic distress due to widespread counterfeiting, displacement as a result of climate-related pressures and the ensuing threat of al Shabaab, an al-Qaeda affiliated terrorist organization, has left Somalia decimated. The national payments system in Somalia presents a glimmer of hope in the fight against widespread poverty in Somalia.

National Payments System

A national payments system simply refers to the infrastructure within a specified country or locality that allows for commercial and financial transactions to occur. This includes a network of banks and a messaging and routing system. The system protects the information and transactions of the public, secures their finances and acts as an avenue into the global economy. A national payments system is essential to the efficacy of national economies and their involvement on a global financial scale.

Until recently, Somalia existed without a national payments system. Domestic financial transactions largely used the U.S. dollar given the prevalence of counterfeit currency in the use of Somali shillings and that little to no domestic financial infrastructure was in place. This financial foundation hamstrung the Somali people and economy to the whim of exterior powers that provided such infrastructure in its most rudimentary form. During this period, Somalia has been in civil war, riddled with environmental decay and stifled by the threat of al Shabaab.

All of the aforementioned conditions created an economic situation in which 64% of the population lives in absolute poverty in Somalia. The national payments system presents a monumental step toward economic progress.

What the Future Holds

With the introduction of a national payments system in Somalia, the Central Bank of Somalia Governor Abdirahman M. Abdullahi stated that “the impact on the economy will be unprecedented. It will boost trade and business… and will enable more financial inclusion in a secure and safe manner.”

The Central Bank of Somalia has also issued its first Visa card and its first mobile phone-centered financial system. During this time, the government has additionally increased its regulation and production of the Somali shilling. All these financial advancements have boosted the IMF’s predictions of Somali economic growth to 2.9% in the next year.

Further Humanitarian Developments

In addition to the progress brought by the national payments system in Somalia, the Somali government has recently passed election and healthcare reform bills to increase equity in their political and social infrastructure.

The National Elections Security Committee, a newly founded governmental body, has begun work on a new initiative to guarantee that at least 30% of the electorate consists of Somali women. The committee has additionally begun numerous programs to protect election integrity and voter privacy.

Support from international bodies ranging from the World Bank to the IMF is essential to the efficacy of domestic progress in Somalia. On the other hand, it is important to note from where the motivation for such changes has arisen.

It was not international groups that began the charge for Somali advancement. Rather, the impetus for this progress came from domestic pressure, not foreign assistance. Through the example that Somalia set, one can easily grasp the potential for self-sufficient humanitarian growth. All the changes are recent and will hopefully be immediately impactful in the global and domestic effort to end poverty in Somalia.

– Jonah Issac Stern
Photo: Flickr

Green Financing in Vietnam with a Big Help From France
The French Development Agency (AFD) announced a $100 million concessional credit line to the Bank of Investment and Development in Vietnam (BDIV) and technical assistance to help establish green financing in Vietnam. As Vietnam continues its rapid development while disproportionately dealing with the adverse effects of environmental challenges, it is searching to develop green financing to underpin a sustainable, efficient renewable energy system. The BDIV plays a crucial role in that transition and the assistance from the AFD is a significant first step in the transition to green financing in Vietnam.

Development in Vietnam

In 1986, a set of economic reforms would fundamentally shift the role of markets in Vietnam. By encouraging private ownership, overturning its policy on forced collective farming and recognizing private land rights, the Doi Moi reforms provided a central role for markets as the primary resource allocation mechanism.

The results have been astounding for economic development and poverty reduction in Vietnam. In the last three decades, the poverty rate reduced from 70% to 6%, and the GDP per capita increased by 2.7 times. In total, more than 45 million people were able to leave poverty. Today, Vietnam is the fastest-growing economy in Southeast Asia.

A component of this development was a shift away from an agriculture-based economy to a more industrial economy. In 1988, agriculture constituted 46% of the GDP. Fast forward to 2014, and agriculture as a share of the GDP had contracted to only 17%, while the service sector and industrial sector accounted for 44% and 39%, respectively.

Economic Consequences

Nevertheless, similar to other nations with experienced industrialization and remarkable growth and in a truncated period, Vietnam struggles to manage the environmental consequences. It logically flows as the more dynamic an economy becomes, the more energy it requires to power it. Likewise, the quicker the development, the more demand for energy will outpace the supply. Vietnam is no exception; on average, its energy demands increase by 10% every year.

Naturally, when demand rapidly outpaces supply, countries search for cheap, quick options to increase supply. Therefore, fossil fuels, a historically abundant and cheap energy source, have primarily fueled Vietnamese development. As of 2019, 84.7% of Vietnam’s energy came from fossil fuels, primarily in the form of coal (50.25%) but also in oil (25.92%) and gas (8.61%).

This Faustian pact with the cheaper, more abundant resources – along with other trappings of middle-income status – comes with environmental consequences. In 1989, Vietnam contributed 0.26 tons of carbon emissions per capita to the globe. By 2017, this number jumped to 1.93 tons. As a result of the severe air pollution, 50,000 people a year die. Although significant inroads have occurred, access to clean water in Vietnam remains a problem as 9,000 people die a year from polluted water.

Environmental Consequences

In addition to medical costs, environmental deterioration has a profound economic cost. Air pollution causes a financial cost of around 5% of GDP per year.

As with most unintended consequences, the most impoverished bear the brunt of it. The most poverty-stricken members of society are the most exposed, susceptible and resource-poor to adapt to the deteriorating environment. However, as the U.N. noted that it also creates a “…vicious cycle, whereby initial inequality makes disadvantaged groups suffer disproportionate loss of their income and assets, resulting in greater subsequent inequality” that threatens the economic development Vietnam has achieved over the last three decades.

On the flip side then, the poor benefit the most from green financing. For example, some researchers investigated this connection by studying 25 Chinese provinces over 13 years and found a high correlation between the two variables. The group argues that through a strong absorption capacity, long industrial chains and a high degree of relevance, green financing has a “pulling effect on economic development and can effectively alleviate poverty.”

Green Financing

Vietnam has recognized this dynamic and has set out to reverse the trend. The government has made significant inroads in providing cleaner development through creating cleaner transportation infrastructure, safer water and shifting to renewables. However, Vietnam achieved these inroads through government financing. According to the Asian Development Bank Institute, to supply energy demand with renewable energy, 50% of total investment in renewable energy development must come from private green financing. Yet, due to a lack of capacity and infrastructure, Vietnam banks cannot get near the 50% number.

Nevertheless, the AFD concessional loan is a significant first step in establishing green financing in Vietnam. As noted, the AFD provided a $100 million concessional loan to BDIV. BDIV is one of the leading financial institutions in Vietnam. It has over 1,100 banks worldwide and assets totaling VND1.56 quadrillion to promote green financing. The credit line will also mark the first green finance fund AFD has set up in Vietnam. Notably, AFD and BDIV earmarked $366,000 of the loan for technical assistance to support the transition.

AFD is valuable and experienced. It has more than 90 projects worldwide worth over 2.3 billion Euros. In addition, it has experience supporting green development in various sectors such as transport, infrastructure, agriculture and energy.

Taking Action

The CEO of BDIV, Le Ngoc Lam, hinted at three critical takeaways for Vietnam and BDIV in particular. First, it will assist BDIV in improving its operational efficiency in financing Vietnam’s green development. Second, it will establish a partnership between BDIV and AFD for future green development loans or projects. Finally, it signals to international partners Vietnam’s willingness to participate in green development projects or financial partnerships.

Put another way, the loan provides significant financing, technical assistance and establishes a partnership that can lead to other green financing opportunities. Therefore, it is essential to establish green financing in Vietnam and, accordingly, sustaining its development and further alleviating poverty.

– Vincenzo Caporale
Photo: Wikipedia Commons

OpenTabs Browser ExtensionPeople are now able to help raise funds to provide loans to impoverished people all over the world through the OpenTabs browser extension. OpenTabs allows users to raise funds passively every time users open tabs in their browsers. Microfinancing proves to be an effective tool to reduce poverty, helping 139.9 million people in 2018 alone through loans and insurances. In particular, microfinance has a lot to offer low-income countries as 1.7 billion people worldwide remain unbanked, according to the World Bank’s Global Findex database.

Barriers to Financing

Every day, financial institutions reject the loan applications of thousands of low-income people looking to escape the poverty trap and start their own businesses as these populations are labeled high-risk and high-cost customers. Crowdfunding loans offered by international nonprofit organizations such as Kiva are often the only means low-income people can afford to help them launch their businesses. Inspired by the impact that microloans have in combating poverty and hoping to make lending easier, 20-year-old Umberto Greco and his colleague Matheus Paro created OpenTabs.

The Story Behind OpenTabs

Umberto Greco told The Borgen Project that on a mission to make crowdfunding loans “affordable and convenient” for lenders in 2019, Greco and Paro created a free web browser extension that allows users to raise funds to provide microloans to people all over the world. Established as a nonprofit organization, OpenTabs allows its users to “passively raise funds” simply by adding the OpenTabs extension to their browsers. By replacing users’ tabbing pages with paid advertising banners, OpenTabs was able to provide more than 107 microloans in more than 18 different countries since its founding in 2019.

How OpenTabs Works

The 2019 award-winning startup, OpenTabs, generates revenue to provide microloans by placing non-intrusive advertisements on the corner of each tab users open. OpenTabs can raise on average one-tenth of a penny for every tab that OpenTabs users open at no cost to users. OpenTabs can transfer all the funds raised through advertisements and turn the advertisements into microloans by using universal nonprofit microfinancing platforms such as Kiva.

After a borrower pays the loan back, usually between 8 and 18 months later, the same funds go towards providing loans to new people. In addition to providing opportunities for underprivileged people by simply opening tabs on a browser, people who add the extension also help save trees. By partnering with Rainforest Trust, a nonprofit environmental organization, OpenTabs will help users protect one tree for every 10 tabs users open. Since its partnership with Rainforest Trust, OpenTabs browser extension has allowed users to save 453,265 trees.

OpenTabs browser extension aids people with busy schedules in helping to provide thousands of impoverished people with the opportunity to start their own businesses. Providing people with the opportunity to start their own businesses and provide for their families allows impoverished people to obtain a steady income. The income helps by improving their living standards and contributing to the local economy and national productivity. Yet, what truly makes the extension effective is its ability to grant financing at no cost for users. Users who would like to join the fight against poverty while lacking the funds to do it can now participate in fundraising by allowing companies to do the funding in exchange for non-intrusive advertising.

– Carolina Cadena
Photo: Flickr

COVID-19 in Cambodia
The IDPoor card is a critical resource in the United Nations’ new COVID-19 Cash Transfer Programme. This program aims to support socioeconomically disadvantaged citizens who COVID-19 in Cambodia has impacted. The IDPoor card, which the country implemented in October 2020, is a form of payment to impoverished families and individuals that helps them access essential resources like food, housing, healthcare treatment, education and more.

IDPoor Card in Action

The Cash Transfer Programme provides Cambodians with financial resources for housing security and healthcare access. The Cambodian government registers individuals in need of economic assistance and indicates how much aid they can receive. With financial support from the U.N. and UNICEF, the Cambodian government has significantly improved the daily lives of impoverished Cambodians.

Yom Malai is a Cambodian woman who received the IDPoor card and described her experience in a U.N. News Article: “We collect the money from a money transfer service,” she says. “During the COVID-19 pandemic, it has been a great help for my family. In addition, if we ever need to go to the hospital, we get medical treatment, care and medicine free of charge.”

Malai also explained the review process necessary to receive a card. It includes interviewing applicants and recording details about each household. By doing this, the government gains a holistic picture of each family’s financial resources and needs. Malai’s experience demonstrates the necessity of the IDPoor card in reducing global poverty, particularly in regions that are suffering economically due to COVID-19.

Poverty on the Rise

Even before COVID-19, Cambodians faced a disproportionately high amount of poverty. The U.N. calculated the hypothetical rise of poverty in this region in 2019, predicting that the impoverished population would increase to 17.6%, more than two times the impoverished count in 2019. Moreover, COVID-19 exacerbated many Cambodians’ financial disadvantages as the country’s economy limited jobs and healthcare needs increased. Specifically, the unemployment rate in Cambodia in 2020 was 3.2%, much higher than the 2019 rate of 0.7%.

The Cash Transfer Programme provides financial assistance to citizens registered with an IDPoor card. Each monthly payment depends on a household’s specific situation and needs. The already existing Cash Transfer Programme received further funding and spread to include as many impoverished Cambodians as possible. This act is a ray of hope amid the impact of COVID-19 in Cambodia.

For individuals who qualify, the card also acts as a form of medical insurance. It allows registered Cambodians to receive healthcare treatments or consultations without being charged. This healthcare coverage is extremely helpful to families as medical bills and incurred costs are large components of poverty.

In a UNICEF article, a young woman named Leont Yong Phin conveyed how her IDPoor card has helped her. “I’m still paying back a loan from when I got bad typhoid,” she says. “This money means I can repay and afford food. We’ve never had help like this before, it’s so reassuring.”

Encouraging Equity

In addition to providing necessary economic support and medical access, the IDPoor card program is essential for encouraging equity in Cambodia and reducing the disadvantages that come with certain socioeconomic conditions. By reviewing applicants’ economic history and family situation, the government can adequately provide the support necessary to address all citizens’ needs. In this way, the Cash Transfer Programme helps Cambodians with daily expenses and works to end inequity across the country.

Although the impact of COVID-19 in Cambodia has been significant, the IDPoor card and Cash Transfer Programme are greatly improving life for many Cambodians. With more support from international organizations like the United Nations, nonprofit organizations and even individuals, the program can provide even more resources to impoverished Cambodians.

– Kristen Quinonez
Photo: Flickr

Algbra is Bridging the Gap Algbra is a “global digital program” for the “unbanked and underserved.” Algbra is bridging the gap in financial inclusion by bringing financial security to developing countries. The emergence of cryptocurrency, artificial intelligence and blockchain technology has spawned endless opportunities within the financial industry. Although these accomplishments are impressive, a shocking 1.7 billion people worldwide are still without access to bank accounts. Banking services offer a convenient and secure money management method, a luxury unattainable for many of the world’s impoverished. Millions of people in developing markets are excluded from the financial system due to “insufficient income levels and market discrimination.” Exclusion from financial services prevents an accumulation of savings, investable funds and asset growth. New World Group vows to bridge the financial inclusion gap in developing countries with the innovative global digital platform, Algbra.

The Algbra Fintech Platform

Algbra is the new London-based fintech platform designed to create a multi-faceted, fair and viable banking experience that fulfills the needs of low-income consumers. The company raised £3.75 million in funds for the Algbra platform, with the aim of educating and uplifting underserved and minority populations so that people can move toward financial freedom.

Algbra is also the first platform of its kind to offer services in consideration of faith-based values. This is a more appealing option for those following the Islamic faith, an unbanked demographic of nearly 800 million people. Some of the products offered by Algbra include “current accounts, foreign exchange, remittances and rewards, with lending products to follow shortly thereafter.”

Algbra’s Impact on Global Poverty

In a study involving 35 countries in sub-Saharan Africa, researchers looked at the impact of financial inclusion on poverty levels among low-income households. Using data from 2011, it was concluded that financial inclusion significantly decreased poverty in sub-Saharan Africa by “providing net wealth and larger welfare benefits” for impoverished people.

On May 19, 2021, Algbra announced its partnership with the Patchwork Foundation, a British organization dedicated to advocating for underprivileged and minority communities to partake in issues of democracy and civil society. Through this partnership, Algbra and the Patchwork Foundation will empower promising young leaders with financial literacy skills and other essential skills. These skills will help the youth become informed policymakers capable of establishing practices that promote social and economic inclusion.

It is important for Muslim women to have a share in financial resources and the opportunity to participate in society’s advancement, all while adhering to Islamic teachings. This is instrumental to economic prosperity for developing countries with large Muslim populations.

However, the World Bank found that the Middle East and North Africa, which are predominantly Muslim regions, have the most significant gender gap in bank account ownership. In these regions, a whole 65% of women are without a bank account compared to 48% of men. Zeiad Idris, CEO of Algbra, believes empowering women by facilitating access to financial services is instrumental to increased economic growth.

How Algbra is Bridging the Gap

The financial industry lacks services that meet the faith-based needs of consumers. As a result, many Muslims limit their usage of financial services. A 2018 Thomson Reuters report indicates that religious considerations prohibited 34% of Afghan individuals and 27% of people in Iraq and Tunisia from utilizing financial services. However in Muslim-majority nations like Jordan, providing Shariah-compliant lending products (loans aligned with religious principles) raised application rates from 18% to 22%, according to a study by Professor Dean Karlan of Yale University.

Shariah compliance prohibits profiting from items or services with the potential to cause harm to people or the environment. Additionally, investors must avoid enterprises that deal with “weapons, alcohol and gambling.” Algbra provides solutions for Muslim consumers who seek Shariah-compliant banking services and solutions. The solutions are also beneficial for environmentally conscientious consumers who are mindful of financial imprints.

The Future of the Financial Industry

Adam Sadiq, CEO of New World Group, explains that a significant amount of people in impoverished nations “face financial exclusion because they cannot open an account at a traditional brick and mortar bank. As a result, they are unable to enjoy the opportunities made possible by economic growth, and in many cases, remain stuck in the poverty trap.” Algbra is bridging the gap in financial inclusion as the latest financial technology innovation aimed at resolving these difficulties through faith-based and inclusive banking services.

Tiara Tyson
Photo: Flickr

Women in AngolaAccording to the World Bank, Angola has a ranking of 0.36 on the Human Capital Index, which is below the sub-Saharan average. This means that the earning potential of a child born in Angola today is 36% of what it “could have been with complete education and full health.” Research indicates that girls and women are often disproportionately affected by poverty. In April 2021, the World Bank agreed to a $250 million Investment Project Financing in order to support Angola. This project aims to empower girls and women in Angola and address educational poverty in order to increase Angola’s human capital.

Women and Poverty in Angola

Data indicates that more than 30% of Angolan women were married or in a union before the age of 18. Furthermore, in 2016, for women 15-49 years old, almost 26% reported violence by a current or previous intimate partner within the last year. In addition, less than half of impoverished women older than 15 are employed. Moreover, 4.8% more adult women than men are severely food insecure. While women have made some strides in politics, making up nearly 30% of the seats in national parliament, less than 30% of women hold managerial positions. The contribution made by the World Bank will assist Angola to rectify the gender disparities between male and female citizens and empower girls and women to rise out of poverty.

Action From Angola

The National Development Plan that Angola implemented in 2015 set out to ensure equality between men and women in economic, social, cultural and political aspects. Further, the primary goals of the plan focused on addressing occupational segregation and rectifying the lack of representation of women in positions of power. So far, several national campaigns have been launched to promote gender equality and women’s rights. These campaigns include violence prevention and breaking down misogynistic traditions like child marriages.

Angola also implemented several policies to achieve gender equality and empower women. The National Development Plan 2018-2022 continues these commitments, with a significant focus on raising awareness of the importance of gender equality and preventing gender-based violence. The support of the World Bank will help to further the work that has already begun.

The World Bank strongly believes in keeping young girls in school. The organization supports the empowerment of young women to improve health conditions and end cycles of poverty. By ensuring the education of girls, the likelihood of child marriages and adolescent pregnancies reduces. This is a critical goal during the COVID-19 pandemic, which forced many schools to shut down and accelerated the dropout rates of young girls.

Components of the Project

The project consists of three components. The first aspect centers on improving sexual and reproductive health services and increasing community knowledge in this regard in order to encourage the use of these services. The second component will finance 3,000 new classrooms and offer support “to improve teaching and learning outcomes.” Finally, the last component relates to “efficient monitoring and management of the project and supports research to inform education policy development.”

One of the keys to the success of any major project is proper financing and the World Bank has just helped Angola take a critical step in the right direction. The $250 million worth of financing will improve the lives of many women in Angola by focusing on education and empowerment.

Samantha Fazio
Photo: Flickr

Branch App The world of financial technology has a lot to offer low- and middle-income countries. Financial technology is essential to accelerate poverty reduction and enhance the growth and development of developing nations. One such innovation in financial technology is a mobile lending app called Branch. The Branch app has tapped into Africa’s emerging markets and the results are inspiring.

The Branch App

Branch offers mobile financial services that are accessible via smartphone. The advantage of this technology is that the app bypasses some of the restrictions that come with traditional institutions. Branch’s goal is to make money lending and credit building opportunities accessible to all people, which the company believes will “open new channels for personal empowerment and financial growth.”

Currently, Branch serves Kenya, Tanzania, Nigeria and India. Its user demographic targets members of the middle class in areas with emerging markets. Branch recognizes that people in these areas are often underserved and is dedicated to servicing them with customer-first products.

The People Behind the Project

Matt Flannery and Daniel Jung co-founded Branch in 2015. Flannery, the CEO, previously developed and led Kiva, a nonprofit microfinancing company. Flannery then set out to create a “branchless bank” for Africa, resulting in a financial app that would provide accessible services to low- and middle-income customers. Flannery is a Skoll Awardee and Ashoka Fellow, making him a highly acclaimed social entrepreneur. He was also part of Fortune magazine’s “Top 40 under 40” list in 2009.

Recently, in March 2021, Branch added a new member to its team: Dayo Ademola, who will oversee Branch’s Nigeria operations. Ademola has more than 15 years of experience working with consumer-centric companies and banking institutions. She has former experience with global fintech and much of her efforts in the field have been toward improving financial inclusion in Nigeria. Ademola is particularly excited about continuing this mission and working with Branch to help Nigerians simplify their relationship with finances. Fortunately, Branch provides a successful avenue to do that.

Branch’s Success

Since its launch in 2015, Branch has made significant advancements toward improving banking accessibility in Africa. Since its establishment, Branch has facilitated $350 million in loans. This is a significant accomplishment since Branch operates in countries with new markets and limited resources. Fintech investments in Nigeria have grown nearly 200% in the past three years, showing that these emerging markets are increasingly recognized as valuable.

Flannery and others see the African markets for the significant opportunities they present. Fintechs, especially those with a background in social entrepreneurship, have the power to transform African markets and improve social and economic stability in these countries. As it stands, Branch has more than four million customers and has issued more than 21 million loans in the countries it operates in. If the  Branch app continues to spread across Africa and other developing nations, Branch has the potential to vastly improve financial inclusivity and lift millions of people out of poverty by providing financial solutions that cater to those with minimal resources.

Samantha Silveira
Photo: Flickr

Financial inclusion can fight povertyRoughly 1.7 billion adults around the world are unbanked and most unbanked adults live in developing countries. Unbanked people have limited political, economic and social power and influence. For roughly half of the world’s unbanked who come from the most impoverished 40% of households in their economies, inaccessible financial services compound problems of poverty. Financial inclusion can fight poverty as it opens doors for people to improve their lives. The pace of technological advancement around the world is bringing universal access to financial services closer to fruition.

The Global Unbanked

Unbanked people are not connected to any type of financial institution. The most commonly cited reasons for being unbanked are not having enough money, account expenses, the distance of financial services and insufficient documentation. Nearly half of the unbanked population falls into just seven economies. The highest numbers of unbanked people are in China and India. It can be clearly noted that banking and poverty are closely related.

“Financial tools for savings, insurance, payments and credit are a vital need for poor people, especially women, and can help families and whole communities lift themselves out of poverty,” says Melinda Gates. Without a bank account, people cannot sufficiently save and the cash is not well protected. The digital economy also has the benefit of keeping a clear record of financial activities, which banks can use when underwriting loans. Loans are among the financial tools that are essential to financial growth and stability.

The Gender Gap

Women make up the majority of the unbanked population in most developing countries. Women may face deepened or additional gender-based barriers to account ownership, rooted in financial institutions, governments or society.

Financial institutions often lack products and policies that are gender-inclusive. For instance, women may find it difficult to obtain the identification or the assets needed to open and maintain an account, sometimes due to government-enforced barriers. Additionally, banking-related expenses are also a burden for women looking to enter the formal economy. Finally, the responsibility of unpaid household labor, along with barriers to education, keep many women from earning enough money to access financial services.

The Societal Roles of Women

Women may earn sufficient money but could be part of society that does not allow for them to connect to a financial institution.

For instance, the tradition of men being the head of household and in control of the finances leaves some women with little to no influence in matters of money. Approximately one in 10 women in developing countries are not involved in spending decisions involving their own earnings.

Women’s Empowerment for Poverty Reduction

Women must be part of financial inclusion efforts as they are integral to fighting poverty. Bill Gates explains that women are most likely to be behind the decisions that benefit the family. More women-led businesses and reduced inequalities are ways that an emphasis on financial inclusion for women can further a nation’s development.

Financial Inclusion Using Fintech

An emerging industry is making strides in financial inclusion. Financial technology (fintech) can be described as technological innovations in the processes and products of financial services. Fintech offers solutions to many of the problems at the root of financial exclusion. A fundamental problem is the lack of time or money to travel to distant financial institutions. Fintech has given users the convenience of accessing their accounts and financial services on a mobile device.

Fintech development has been gaining momentum since the COVID-19 pandemic began. Touchless transactions and banking reduce the risk of transmitting COVID-19 and have led many to embrace digital payment, in business and in personal practice. Fintech leaders are proving that underserved communities can be reached through financial technologies. Significantly, this helps foster financial stability for the formerly excluded.

Female-led fintech, Oraan, is working toward financial equality in Pakistan because women make up 48% of the population but only 6.3% of the formal economy. Oraan developed a platform that allows for digital savings groups. Savings groups can help empower women and ensure financial equity as they are well-established financial tools.

The Road to Universal Access

Because financial inclusion can fight poverty, digitized financial services are an effective way to improve access and inclusion. Online banking communities are empowering individuals and opening up opportunities for economic growth. By facilitating conversations about finances, informing underserved groups on the best financial practices and ensuring digital finance infrastructure is accessible, the world can make greater strides toward financial inclusion.

Payton Unger
Photo: Flickr