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JOHANNESBURG – There is a quiet revolution underway in Africa and, like all of them, its success depends on the beliefs and behaviours of ordinary people. People like Constance Sampa, in Lusaka, Zambia. Seven years ago, she got a job as a teller at a banking agent outlet for Zoona, a mobile payments provider. Today, she owns 37 outlets of her own and employs 47 people, almost all of them women. 

According to Constance, “Mobile finance has grown rapidly, because it is easy to use, and people are very familiar with mobile phones. Since almost everyone has a phone, the future is bright for mobile financial services in Africa.”

Constance’s story is an example of the movement that is enabling more people across Africa to access and use basic financial services. In fact, financial inclusion is one of the continent’s remarkable success stories of this decade. Thanks to new technology and innovative business models, the financial inclusion rate on the continent has jumped from 23 percent in 2011 to 43 percent in 2017, according to new data from the World Bank Group Findex survey. 

Mobile money facilities and banking through agents now offer affordable, instant, and reliable transactions to poor people in urban areas or those people living in remote parts of a country. Savings, credit, and insurance services are now available in places where no bank has ever established a branch. 

This is, quite literally, banking at your fingertips – for everyone. It is breaking the conventional ways of thinking about banking and it is certainly cause to celebrate. The goal of this revolution is to achieve universal financial access by 2020, meaning all adults will then have access to at least a basic transaction account or mobile money account. 

Small-scale entrepreneuers

Despite remarkable advances, many low-income people, small-scale entrepreneurs, and rural communities still lack the ability to store money safely, make swift and low-cost transactions, or access formal credit to invest in a business or provide for a family emergency. That is why it is now time for the regional financial industry, investors, development finance institutions, and regulators to make a final push and build on the gains made so far so that the benefits of formal financial services extend to all African adults.

A recent report  from IFC and the Mastercard Foundation, Digital Access: The Future of Financial Inclusion in Africa, outlines challenges that need to be addressed for further growth in Africa’s financial services sector. Expanding financial services to the last mile will require investments in merchant and agent networks. There needs to be greater innovation along agricultural value chains. As well, new products and services are needed to meet an increasingly nuanced demand from an even broader variety of users, such as entrepreneurs, merchants, smallholder farmers, youth and women. 

Regulators across the continent can now learn from a decade of experience as the most mature markets have been leading the way to promote innovation and access while also protecting consumers. Tanzania’s ground-breaking efforts to enable interoperable mobile money payments is one inspiring example. 

In Kenya, the leading market for digital financial services on the continent, account ownership is now above 80 percent and on par with China. Other markets can follow. In Benin, Burkina Faso, Cameroon, Central African Republic, Chad, the Democratic Republic of Congo, the Republic of Congo, Gabon, Guinea, Lesotho, Liberia, Madagascar, Malawi, Mali, Niger, Senegal, Tanzania, Togo, Uganda and Zambia, the financial inclusion rate has at least doubled since 2011. 

With success it is easy to become complacent, but it is now important and urgent to make a concerted effort to cross the finishing line of universal financial access. Ultimately, the opportunity for people like Constance to provide financial services far and wide across the continent to reach the millions that still lack access to formal financial services depends on a collective and sustained effort of all private and public actors in the market. Together, we can truly achieve change and proclaim success in this quiet, but decidedly essential, revolution. 

Sergio Pimenta is IFC vice president, Middle East and Africa, and Ann Miles is director of thought leadership and innovation at Mastercard Foundation. 

The views expressed here are not necessarily those of Independent Media.

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