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Visa’s Investment in Africa’s Digital Economy

Africa's Digital Economy
As the world’s digital economy expands at an exponential rate, it continues to be a vital component in raising the world’s impoverished nations and people out of poverty. By the end of the decade, 70% of new value in the global economy will transpire from digitally-enabled businesses. There is a great opportunity for impoverished and developing countries to boost their own economies and raise their people out of poverty by having access to these emergent digital markets.

However, Africa has been lagging behind in its digital economic growth. That is why Visa, a large multinational financial services corporation based in the United States, has pledged to invest $1 billion in Africa’s digital economy by 2027, helping create opportunities for more Africans to engage in the digital market, as well as have access to safe, reliable financial services and technologies. 

Identifying the Problem

The growth of Africa’s digital economy has been stunted and uneven. As of 2015, almost 500 million adults in Africa or nearly 40% of Africa’s total population lack access to formal financial services including banking services and access to digital purchase platforms. Compounding this issue is the fact that things like digital payment methods are not readily available. More than 40 million merchants (i.e, stores, vendors, etc.) in Africa do not accept digital payments and less than 50% of the entire adult population have made or received digital payments of any sort as of December 2022. 

Digital economic inequality is not only present when comparing Africa to developed nations, but also within its own borders as well. For example, in Central Africa, only 11% of adults have a bank account, compared to 51% in the far more developed region of South Africa. This stark divide is especially present in access to financial technologies. For example, while there are 50 ATMs per 100,000 individuals in South Africa, there are only 11 per 100,000 individuals in North Africa and less than five per 100,000 individuals in all other African sub-regions.

Visa’s Pledge

This lack of access to financial resources and technologies, especially in the global digital market, is a large issue facing the impoverished populations of Africa. It is not insurmountable, however. Visa believes that Africa can overcome its issues, which is why the company has pledged to invest $1 billion in Africa by 2027 to accelerate the growth of the continent’s digital economy. Visa, one of the largest financial companies in the world, has established a plan to upscale the company’s African operations on all fronts, including the deployment of new technologies and providing opportunities to educate locals in digital economics.

Over the next five years, Visa will establish local operations for the first time in several impoverished African countries, including the Democratic Republic of Congo (DRC), Ethiopia and Sudan. Part of this growth involves the implementation of new technologies that make it easier for both consumers and merchants to make digital payments, like Tap to Phone, a technology that allows people to make purchases with a simple tap on one’s smartphone. Such innovative solutions will not only encourage more consumers and vendors to make digital payments but will also make it easier and safer for them to do so.

Visa has also pledged to invest in education and empowerment for those especially struggling to enter the digital economy. For example, the company has teamed up with She’s Next, a global advocacy program for women-owned small businesses, which brings funding, mentoring and networking opportunities to female entrepreneurs across sub-Saharan Africa. Visa’s plan to increase financial literacy also focuses on crossing language barriers; for example, it is working on the first-ever Arabic version of its financial education program, Practical Money Skills.

Visa’s Pledge to Develop Africa’s Digital Economy

There is still a long way to go to connect Africa’s impoverished people with the world’s digital economy. However, thanks to the work of Visa and other organizations, and to increasing awareness of their need, there will be great progress in accelerating Africa’s entrance into the global digital economy.

– Elijah Beglyakov
Photo: Flickr

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She’s Next Program Empowers Women Entrepreneurs in sub-Saharan Africa

Women Entrepreneurs in sub-Saharan Africa
In September 2021, Visa, a large virtual payment and financial services company expanded its She’s Next program to help women entrepreneurs in sub-Saharan Africa (SSA). In August 2022, Visa announced that the development will include a $3.5 million grant to organizations that support small and micro businesses (SMBs), such as the African Women Impact Fund (AWIF), a U.N. Economic Commission for Africa (UNECA) cause. The grant will “fund the working capital needs of women fund managers” and support “55 women who responded to AWIF’s call to action.”

Empowering Female Entrepreneurs in Africa

First introduced in 2019 in the United States, the She’s Next program advocates for women entrepreneurs globally through all stages of business growth. This newly expanded program provides these business owners with “access to insights via research and engagement with small businesses, private and public sector communities and educational resources. ”

Visa’s partnership with She Leads Africa, an online platform that connects African women entrepreneurs, provides users with access to a network of more than 700,000 female business owners, resources for digital accessibility and funding.

Gratifying an Essential Market

According to Forbes, Africa is “the fastest-growing continent” in the world as of 2021. As digital literacy becomes increasingly desired, and mandatory for some, it is imperative that African countries prepare their citizens. The International Finance Corporation has reported that in eight years’ time, digital skills will be essential to “230 million jobs in sub-Saharan Africa.”

As of 2019, only half of the nations in Africa provide computer skill training as a subject in their education curriculums in comparison to “85% of countries globally.” This paired with a high demand for digital skills creates a skill shortage, making it more difficult for companies to hire locally.

The World Bank said that “This translates into an opportunity estimated at $130 billion to provide digital skills through a combination of business-to-consumer, business-to-business and business-to-government training services.”

The Rise of Digital Commerce

Through a research study called “Understanding Women-Owned SMEs,” Visa aims to understand how technology affects women-led businesses’ success in Nigeria, Kenya and South Africa. This study found that, in addition to pandemic-related struggles, “a lack of technological infrastructure,” economic volatility and a “regulatory environment” are the most prominent obstacles to business growth for women entrepreneurs.

The study found that 83% of survey respondents who implemented digital payments experienced increased revenue. About 70% of women foresee their customers using “e-commerce platforms” more frequently post-pandemic, further encouraging these women entrepreneurs to establish an online presence.

Women Entrepreneurs in sub-Saharan Africa

As of 2017, SSA had the “highest rate of women entrepreneurs” globally (27%). In fact, Uganda and Botswana had the highest percentage globally at 34.8% and 34.6% respectively. However, female entrepreneurs in sub-Saharan Africa garner profits 34% lower than males.

A lack of education and skills reduces women’s access to employment opportunities. As a result, women may look to entrepreneurship as a way out of poverty. Initiatives such as Visa’s She’s Next program address the barriers that women entrepreneurs in sub-Saharan Africa face, furthering their economic independence and prosperity.

– Aishah French
Photo: Flickr

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Brands That Nourish Impoverished Communities

Nourish Impoverished Communities
It is no secret that the United States is home to some of the biggest brands in the world. From cosmetics to food products, American brands influence many things global consumers see on their shelves in one way or another. Here is how four American brands help nourish impoverished communities.

Avon

Avon Cosmetics has been benefitting women since the mid-1950s through the creation of the Avon Foundation. For the past 65 years, more than $1 billion has gone toward sustaining women and their families all over the globe. The Avon Foundation’s humanitarian practices have opened up in more than 50 markets across nations, allowing women to feel empowered and begin their own businesses. Any woman can apply to become a representative using Avon’s online website.

Avon Connect is a program that sets the foundation for women to begin their dream businesses. The program provides education on the basics of sales and marketing to nearly 500,000 women worldwide. Through participation, women create jobs for themselves by becoming one of Avon’s Beauty Advisers.

Nestle

Nestle does not only offer water and coffee, the company also implements programs to help nourish impoverished communities around the globe. The company was originally a Swiss brand but has since expanded its locations worldwide. Now, the United States is one of its larger consumers, and it works with farmers and suppliers all over the world. By providing work for those in rural areas, Nestle creates a sustainable supply of food in those communities.

Nestle’s program Global Alliance for YOUth has helped alleviate the problem of unemployment within younger demographics. It provides work opportunities for young people, despite the lack of experience they may have. The program also encourages young people to become entrepreneurs and take control of their own business. By 2030, YOUth plans to benefit 10 million youths by providing employment and skills to help further their lives. Nestle’s Global Alliance for YOUth program brings together 21 international companies to help employ around 15 million youths by 2022.

Walmart

Walmart has provided neighborhoods with fair prices and good products since its beginning. The company aims for its global suppliers to be sustainable and responsible in the workplace. In fact, it has over 100,000 responsible suppliers around the globe. Walmart strengthens not only consumers but also those who help nourish impoverished communities.

In 2010, Walmart decided to actively help alleviate global hunger. More than $2 billion in food donations and grants went toward starving communities. In 2015, it donated around four billion meals to help the hungry. Walmart hopes to benefit an additional four million in 2020 by providing more meals and increasing education.

Walmart contributes to its local communities no matter the country. In 2019, Walmart provided over two million jobs in 27 countries. Employment is beneficial for those working toward upward mobility out of poverty. Walmart, with its 11,300 locations, helps provide just that.

Visa

Almost two billion people worldwide have not implemented banking into their lives. Visa is here to help fix that. In one year alone, Visa provided financial systems for nearly 500 million people. Its help went to women and those living in rural areas —those least likely to have any sort of financial aid.

Through Visa, many have been able to better support and sustain their small businesses. As a result, many have been able to acquire the skills they need to efficiently work in their business and develop the most appropriate services for growing their economy. Visa’s Practical Business Skills, founded in 2019, has helped small businesses from the beginning stages, allowing more efficient and proper company growth.

For instance, in Southeast Asia, Visa partnered with a large payment service to encourage all to improve their banking literacy. In Mexico, over 11 million people have started their own banking account with a Visa-partnered Mexican financial institution. Through the global implementation of Visa, people have been able to improve their finances, which helps nourish impoverished communities worldwide.

Global poverty is a huge and pressing issue. These American big brands can help people manage their lives with a bit more ease by providing support.

– Karina Wong
Photo: Flickr

5 Facts About Poverty in Mongolia

Poverty in Mongolia
Mongolia is a landlocked nation in East Asia, caught between Russia to the north and China to the South. Since transitioning into a capitalist democracy in the 1990s, it has become one of the region’s fastest-growing economies. However, various issues such as poverty and uneven economic growth are holding Mongolia back. Here are five facts about poverty in Mongolia.

5 Facts About Poverty in Mongolia

  1. Poverty Rates: According to the World Bank, 28.4% of Mongolians lived below the poverty line as of 2018. The Mongolian poverty line is defined as living off 166,580 Tugrug ($66.4 USD) per month. A further 15%  are vulnerable to falling into poverty due to unforeseen events. Taken together, these statistics show that two out of every five Mongolians live in or close to poverty.
  2. High Inflation: Mongolia has been experiencing rapid inflation over the past few years, compounding the issues surrounding poverty in Mongolia. Inflation rates increased from 0.73% in 2016 to 7.26% in 2019. This financially strains vulnerable communities that already struggle to provide for necessities. High inflation notably impacts the urban poor more than the rural poor; while the urban poor need to buy all their food, many rural herders and farmers can produce much of their own food and gain greater profits from increased prices.
  3. Uneven Economic Growth: Mongolia’s GDP has grown in the past few years, but that does not mean that everyone has benefited. Approximately one-third of Mongolian GDP growth comes from mining, which only employs about 6% of the total population and relies heavily on foreign investors. Rural areas are experiencing continuing economic growth due to increased livestock prices, as well as higher rates of consumption and decreasing poverty rates, as opposed to their urban counterparts. This is most evident in the rates of herders who fall below the poverty line. According to the World Bank, “Herders were among the poorest in 2010, but now only one in three herders are estimated to be poor.”
  4. Rural Versus Urban: One can best see this uneven economic growth in the divide between the rural and urban poor. While poverty percentages have decreased in rural areas, the rate of urban poverty has remained unchanged. As previously stated, those in rural areas are experiencing economic growth while the urban poor experience stagnation. Rural poverty decreased from 34.9% in 2016 to 30.8% in 2018, while urban poverty hovers just above 27%. While the rural poverty percentages are still higher, it is important to keep in mind that 63.5% of the poor live in cities.
  5. Poor Living Conditions: Due to the country’s nomadic past, gers (traditional Mongolian tents), are still widely used throughout the country. These structures are cheap compared to apartments and other housing arrangements, with both the rural and urban poor living in them. A reported 57% of all poor Mongolians live in gers. However, most gers lack many modern necessities such as insulation and running water. This exacerbates the fact that nine in 10 poor Mongolians lack access to various basic infrastructure services like sanitation and heating. The central government is continuing to address these issues and is attempting to move those living in gers into more modern housing.

The Good News

Mongolia has been experiencing nearly 30 years of economic growth and social development. Many experts describe Mongolia as “The Wolf Economy” due to its massive growth and supply of natural resources. The nation has tripled its GDP since 1991 with help from international groups and smart government investments. Health care industries have seen a massive improvement, with Mongolia seeing declines in maternal and child mortality rates. The government has also instituted various programs to help people out of poverty in Mongolia and raise the general standard of living. The United States has provided aid and development funds to help strengthen the Mongolian economy and promote democratic political reforms. As a result, the US is Mongolia’s fourth-largest import partner, valuing more than $200 million in items such as machinery and consumer goods. Various American businesses also operate within Mongolia such as Visa, Caterpillar Inc. and GE.

– Malcolm Schulz
Photo: Flickr

Visa Helps Advance Consumerism in Sub-Saharan Africa

Advance Consumerism in sub-Saharan Africa

As a way to build a more “digitally exclusive ecosystem,” Visa is partnering with Branch International to advance consumerism in sub-Saharan Africa. So the Branch-Visa partnership offers over 2 million consumers in sub-Saharan Africa virtual, prepaid Visa debit cards. With these virtual Visa accounts, consumers can then create accounts on Branch, the most downloaded finance app in Africa. Now, with access and finance, citizens are even able to invest in technology. As a result, this donation will advance consumerism in sub-Saharan Africa, even enabling consumers to start their own tech companies.

Here’s how and why Sub-Saharan Africa needs this.

Sub-Saharan Africa Can Participate in Global Consumerism

Giving citizens in sub-Saharan Africa access to online purchasing allows them to contribute to global markets. Many setbacks prevent citizens of impoverished African countries from entering this market. These setbacks include:

  • Lack of transportation
  • Limited stores selling modern, technological products
  • Having only cash to buy products
  • Having low or no credit score

Enabling these citizens to start their own tech companies will advance consumerism in sub-Saharan Africa, as products become accessible and affordable.

Most of Sub-Saharan Africa is Unbanked

According to Business Insider, only about 30 percent of sub-Saharan African adults had a bank account as of 2014. This percentage drops to below seven in Niger, Guinea and the Central African Republic. About 42 percent of citizens in these countries cite lack of money as the reason for not having an account.

But with prepaid debits cards, over 2 million citizens in Sub-Saharan Africa can now access online banking. Additionally, the region is also expanding its internet access, to even the most remote parts of Kenya and Tanzania. Ultimately, these efforts will advance consumerism in sub-Saharan Africa, as online banking becomes accessible to more citizens.

Merchants Can Grow Their Businesses

Currently, most small businesses and startups in sub-Saharan Africa are unable to access quick loans. However, the Visa-Branch partnership also includes preferential small business loans to Visa merchants. So as small businesses and startups grow, citizens will have greater access to tech companies across the region.

Because most sub-Saharan African citizens do not possess bank accounts, they rely on cash and only invest in local businesses. But this partnership with Visa and Branch International allows these citizens to use online banking and expand their reach. In doing so, they not only help grow businesses across the region but advance consumerism in sub-Saharan Africa.

– Sara Devoe
Photo: Flickr

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Visa Gives Refugee Athletes a New Beginning

Refugee AthletesPreceding the 2016 Rio Olympic Games, the International Olympics Committee (IOC) announced that a team of 10 refugee athletes would be allowed to compete in the games and carry the Olympic flag. The team was called Team Refugee Olympic Athletes and was treated just like any other Olympic team.

By allowing the refugee athletes to be a part of the Olympic Games Rio 2016, the IOC is hoping to give hope to refugees everywhere.

“Having no national team to belong to, having no flag to march behind, having no national anthem to be played, these refugee athletes will be welcomed to the Olympic Games with the Olympic flag and with the Olympic Anthem,” said IOC President Thomas Bach in a news release. “They will have a home together with all the other 11,000 athletes from 206 National Olympic Committees in the Olympic Village.”

While these athletes now have a chance to be a part of a team in uncertain times, Visa, the world’s largest payments network, saw that there was an even bigger opportunity for comradery. Team Visa is a network of Olympic and Paralympic athletes who are sponsored by Visa.

In July 2016, all 10 refugee Olympic athletes signed on to become a part of Team Visa. Through the partnership, the refugee athletes are supported in their athletic journey’s and in turn, help Visa to promote a culture of acceptance.

According to Chris Curtin, Visa’s Chief Marketing Innovation and Brand Officer, the perseverance the refugee Olympic athletes is inspiring not only Visa, but the world. The bravery that allowed the athletes to get to the Olympic games and march with the Olympic flag directly embodies Visa’s belief in acceptance for everyone, everywhere.

While the Rio Games proved a success for the refugee athletes and Team Visa overall, neither party shows sign of stopping there. On July 9, 2017, the IOC confirmed that a Refugee Olympic Team will compete at the 2020 Tokyo Games.

Team Visa’s involvement with the athletes has not yet been confirmed, but a source says they are looking to extend relationships.

“We are committed to sustaining our message of acceptance worldwide and are exploring longer term partnership opportunities with the IOC on their Olympic Solidarity Initiatives, and with the International Paralympic Committee (IPC) on their refugee development programs,” a spokesperson told The Wrap. “We are also exploring contract renewals for select Team Visa athletes in preparation for the Tokyo 2020 Olympic Games.”

– Madeline Boeding
Photo: Flickr