JOHANNESBURG, South Africa, 30 October 2015,-/African Media Agency
(AMA)/- This World Savings Day Barclays and leading charities CARE
International and Plan UK celebrate providing access to informal
financial services to nearly 300,000 young people across Africa. The
bank now calls on other financial institutions to follow suit and
implement innovative savings models, enhanced by the latest
technologies.
There are currently nearly 2 billion financially
excluded adults around the world. Despite the introduction of mobile
money and clever smartphone applications, 38 percent of all adults have
no access to formal financial products. Working in partnership on a
programme called Banking on Change with NGO's CARE International and
Plan UK, Barclays has set out to change this.
With a focus on
supporting young people, the Banking on Change programme works in seven
countries to give those in some of the world's poorest communities the
skills to save, as well as access to basic financial services.
The
principle is simple; no-one is too poor to save. By forming community
savings groups, individual members, most of whom earn less than US$2
day, save and lend together. Over 11,000 savings groups designed to meet
the specific needs of young people have been created by the programme.
They are provided with training to develop the skills and knowledge to
save, manage their finances, and in most cases to set up a small
business.
Barclays has developed bespoke products to suit the
needs of a growing customer base in Africa, including group bank
accounts, mobile banking products, and an overdraft facility.
The
partnership has worked closely with the Grameen Foundation and Airtel
in Uganda to develop innovative new mobile products. These products
surmount some of the challenges preventing savings groups and others
access from accessing financial services, such as distance to local bank
branches and a lack of access to customer data.
Stephen Van
Coller, Chief Executive, Corporate and Investment Banking, at Barclays
Africa, said "Delivering mobile financial solutions in Africa, we are
able to bypass traditional modes of banking, as experienced across the
rest of the world. Innovation in mobile means we can create solutions
that are geared towards the needs of local communities, businesses and
savers - meaning we can tap into a much broader customer base across the
continent".
Smartphone innovations are fostering financial
inclusion among the poor and unbanked, increasing financial
transparency, and reducing security risks for staff and clients. Less
commonly talked about are the wider, positive 'side' effects that these
applications have for women in particular.
In Uganda, where
there is a vast gender gap in finance, evidence has shown that
smartphone applications can yield surprising benefits for women,
particularly young women. The Kyebakola Kyobona youth savings group is
one of the groups using Ledger Link, which helps members build a credit
history with the bank by enabling them to submit digital records of
their savings and loan activities.
These technologies help the
women, in particular, better manage their finances, empowering them to
take the lead in determining household finances. There have also been
improvements in overall financial literacy, increased confidence and
even social status as a result of the training and support provided.
Using lessons learned from Banking on Change, Barclays, CARE International and Plan UK have established the Linking for Change Savings Charter
to encourage other financial institutions' involvement in this issue.
The charter sets out international principles enabling other
organisations to effectively link community groups to formal banking
products and savings.
Banking on Change model demonstrates how
grassroots saving and linkage to financial institutions can contribute
towards closing the gap on the two billion unbanked people across the
world. There are clear opportunities for banks and other formal
financial institutions worldwide, with informal savers alone
representing a pool of potential customers with the ability to save $116
billion each year
