The Mennonite Economic Development Associates (MEDA) has announced that it has joined the Better Than Cash by working to help in the transition of the large number of payments in cash to electronic payments that will help their partners expand financial services and lower barriers to entry for the poor who wish to enter markets and help themselves with small enterprise solutions.
“For more than 60 years, MEDA has been helping millions of poor people by creating sustainable business solutions to poverty and providing them with access to finance and markets,” said Allan Sauder, President of MEDA. “Electronic payments are an important component of our services, providing people with a secure, quick and cheap means of accessing their savings. Joining the Better Than Cash Alliance will allow us to be part of the collective effort to make these types of electronic payments more widely available, especially to the poorest and most underserved communities around the world.”
Programs which currently work with cash or in-kind goods to the poor, or to provide access to other financial services, will benefit from the adoption of electronic payments and will result major cost savings, transparency, security, and economic growth. Also, these systems will allow giving to shift to the trends of an ever more cashless society and lowering resistance to giving because of not having cash to give. Supporting this theory the World Bank recently reported that governments can save up to 75 percent of costs by shifting to electronic payment programs for economic aid programs.
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The Better Than Cash Alliance, is an initiative founded by the Bill & Melinda Gates Foundation, Citi, Ford Foundation, Omidyar Network, USAID, U.N. Capital Development Fund and Visa Inc., which partners with governments, the development community and the private sector to incentivize the transition to electronic payment solutions and assist those who make the move.
The issues of being excluded from the financial sector are most common in the developing world, where approximately 80 percent of poor people not included. Resulting from this poor households rely on cash only transactions or donations and lack access to savings, credit, and/or insurance that others have the benefit of in their financial planning. Electronic payments will allow those low income households to have a chance to plan for their future and have protection for their assets they would otherwise not have.
“We commend MEDA on their leadership and commitment to empower poor individuals and entrepreneurs by transitioning to electronic payments in its inclusive financial services and market development initiatives around the world,” said Dr Ruth Goodwin-Groen, Managing Director of the Better Than Cash Alliance. “There are many benefits of electronic payments but also challenges and these can best be tackled in partnerships. We welcome MEDA into the Better Than Cash Alliance and look forward to our partnership with them.”