IFC Vice President Karin Finkelston Speaks about Digital Opportunities in Africa
A few years ago, about two million people were unbanked worldwide. The World Bank is working to bridge that gap through a commitment to universal access to financial services by 2020. IFC Vice President Karin Finkelston says the segments that should be focused on are youth, women, rural populations and smallholder farmers.
“When we look at where jobs are developed, it's primarily in the private sector and mostly small businesses. For us, getting financing to small businesses is really about creating jobs and opportunities for people in Africa to be employed and to improve their livelihood,” Finkelston said while attending the SME Finance Forum’s Africa SME Finance Forum 2018 in Nairobi.
Digital opportunities have proven effective for SMEs and the unbanked in Africa. In rural communities, it is expensive to place bank branches, but using digital technology, financial service providers can access people who were unbanked. With mobile money and digital financial services the unbanked can have access to bank accounts for the first time.
“We've seen women be disproportionately affected by the SME finance gap. I think when we look at women coming into the economy, this has huge benefits for the macro-economy itself, but also their families, for the way they spend money, and children's health and education, which then creates a knock-on effect for the future of the country,” she said.
Finkelston says there is a whole market of rural businesses that banks can tap through digitization. In this video, she shares the type of opportunities available, the resources needed for financial institutions to serve SMEs and the possibilities for smallholder farmers with mobile money.