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Since the beginning of the digital age, there have been several advances in the world of digital currency. From mobile banking apps to mining for cryptocurrency, the use of physical bills and coins is becoming less common. The potential of this new technology in developing countries, particularly for those in Africa, cannot be ignored. Here are four ways digital currency in Africa can improve the economy.

4 Ways Digital Currency in Africa Can Improve the Economy

  1. Transferring money is easier and faster when combined with technology. For those who cannot waste time waiting for money to travel from one location to another, digital currency in Africa would allow for conveniently instantaneous transfers. Additionally, more companies are taking notice of the strong potential market for digital currency in Africa and the positive impact it could have on citizens and businesses. Airtel Africa, a telecommunications company serving East, West and Central Africa, has recently partnered with Mukuru, an online remittance company, allowing Mukuru customers to instantly send money transfers directly to Airtel Money customers across 12 African countries. This means that people can make intra-Africa payments from Southern Africa, where Mukuru has a major presence, to other nations in Africa. Users would also benefit from no longer going to an agent to receive international payments physically. Once Airtel Money customers receive the money, they can use it to pay bills, purchase goods and services or even cash out at one of Airtel Africa’s branches or kiosks. This will allow African citizens to get the most out of their money.
  2. Managing personal income leads to greater financial literacy. As the use of digital currency spreads, people are increasingly exposed to the language of business as well as standard banking practices. For those living in countries with low financial literacy rates, this could be the difference between economic stability and poverty. The implications of digital technology in Africa are astronomical due to the previous lack of education on these financial principles across the continent. In Somalia, the current rate of financial literacy is estimated to be 15%. On the other side of the spectrum, Botswana has a rate of over 51%—the highest in all of Africa. With this first-hand knowledge, more people will be able to learn how to manage their finances properly.
  3. Digital currency allows for more connections between African citizens and the rest of the world. The use of digital money transfers not only allows those living in Africa to pay and request money from people within their continent but also those around the world. With the recent partnership between Airtel Africa and Mukuru, small business owners in Africa can now establish business relationships with people in Europe, Asia and the United States, among others. As these relationships continue to grow, the digital currency can flow freely between Africa and the rest of the world, opening the continent up to high-dollar investments from more developed regions and, in time, lead to a potential rise in the African economy.
  4. More women have access to their finances. Only 37% of women in Sub-Saharan Africa have a bank account compared to 48% of men—a gap that has only widened in the past few years. The numbers are worse in North Africa, with around two-thirds of the adult population remaining unbanked and the gender gap for access to financial education standing at an 18% difference, the largest in the world. However, with the rise of digital technology in Africa, more women can become empowered and take control of their finances. Female entrepreneurs rarely apply for loans as a result of low financial literacy, risk aversion and fear of losing their businesses. If these women were to utilize digital banking technology, they would be able to pay employees, investors and, most importantly, themselves more efficiently. As more and more women manage their finances, they will be able to lift themselves out of poverty and strengthen their local economies.

As digital currency in Africa continues to flourish, more entrepreneurs, families and willing investors will be able to witness the rise of the African economy. Money transfers and online banking will likely support the growing economy as it joins the rest of the world in the technology age. With continued global support, African citizens will be able to lift their economy to new heights.

Daniela Canales
Photo: Flickr

Africa_Digital_Education World Economic Forum

Digital education is a hot button topic in the United States, and last week, an international panel convened in Kigali, Rwanda, to discuss the efficacy of digitalizing African education systems. Held at the World Economic Forum on Africa, the friendly debate included education and governmental officials and digital education technology experts from around the world. Together, the panel discussed the two great hardships of African education—access to education and quality of education—in the context of a digital education revolution.

When some imagine the future of digital education, they see holograms and tablets, but the Digital Education panel put that idea to rest. “An educational overhaul isn’t feasible or realistic,” said Rapeland Rabana, founder of Rekindle Learning. “[We need to] look where we can build on what we already have,” she added.

In this way, struggling African governments will not be overwhelmed by new technological demands. Besides, according to TIME Magazine, only around 20 percent of Africans have access to the internet, and 40 percent don’t even have access to regular electricity. The argument can be seen that a hologram-touting educational reform system would do little in this environment.

One of the most important ideas discussed by the panel was that of privatized messaging platforms, like Messenger, WhatsApp or WeChat, as the digital basis for educational apps. Although attempting to privatize education could pose challenges of its own, Minister of Youth Jean Philbert Nsengimana pointed out that most African governments could not complete an educational transformation on their own. Instead, he said, “[We should] move away from the either-or debate and look at how the system can work together.”

Globally 57 million school-age children, many of whom are young girls, do not have the opportunity to attend school. Although the panel’s focus was digital education in Africa, the members did not forget that education is an issue outside of the continent.

Nsengimana brought this up and made it clear that he sees digital education as a means of inclusion for these educationless students, especially the young girls. Despite the logistical difficulties and the long implementation project, the Digital Education Panel at the World Economic Forum on Africa came to an encouragingly simple conclusion: by using the technologies that are already in place and focusing on accessibility in addition to advanced development, digital education tools will without a doubt be the future of education in Africa.

Sage Smiley

Photo: Flickr