Kuala Lumpur, Malaysia – June 12, 2020 – Alliance for Financial Inclusion (AFI), in partnership with the Mastercard Foundation, is implementing a COVID-19 Policy Response program in Africa in response to the devastating impacts of the global pandemic.
The two-year project, which is commencing immediately, will focus specifically on micro, small and medium enterprises (MSMEs) and digital finance. It will target 49 financial sector regulators and policymaking institutions across the region to strengthen their capabilities to effectively respond to the economic consequences of COVID-19. Gender and youth policy considerations will be integrated into all policy interventions.
With over 7.5 million people infected globally by 12 June 2020, the pandemic is triggering widespread unemployment and falling levels of gross domestic product in almost all countries. This is disproportionately impacting the most disadvantaged segments of populations; women, young people, the elderly, disabled and forcibly displaced persons (FDPs).
With more than 60 million people globally facing poverty, emerging and developing economies are being hit the hardest, especially the MSMEs that are their backbone. Women-owned MSMEs, which make up 32 percent of the total MSME financing gap, are feeling the effects of the pandemic the most. Young people, already squeezed by low levels of employment, education and training opportunities prior to the pandemic, have been feeling its devastating effects with an increasing over-representation in the informal economy and disproportionate exclusion from the formal financial system.
“Financial inclusion is one of the very few solutions available that can immediately address the issues facing hard-hit economies across AFI’s global membership. In Africa, AFI members are already providing digital finance solutions, especially for MSMEs and specifically those owned by women,” AFI Executive Director Dr. Alfred Hannig explained.
Digital finance helps fast track the uptake of digital financial services to enable governments to make ‘cash’ transfers safely to those who need them, allowing continuity of business activity during the COVID-19 crisis and jumpstarting economic recovery.
AFI’s work in Africa with Mastercard Foundation aligns with the network’s ambition to leave no one behind by building on its 2019 Kigali Statement, which calls upon the acceleration of financial inclusion for disadvantaged groups, including the youth.
AFI and the Mastercard Foundation aim to enable financial sector regulators in Africa to deliver quick and appropriately gender-sensitive policy responses that mitigate the effects of COVID-19 on businesses and individuals, especially for MSMEs, women, young people, and FDPs. Policy interventions across the region would be delivered through peer learning, policy guidance, development of knowledge products, and AFI’s public-private dialogue (PPD) platform. In-country implementation activities would be conducted specifically in Nigeria, Uganda, Rwanda, BCEAO, Senegal, and Ghana.
“Under the Mastercard Foundation COVID-19 Recovery and Resilience Program, we are working on the continent to address the pandemic alongside partners and communities. We are assisting institutions and communities in Africa to withstand and respond to the short-term impacts of this pandemic, while strengthening their resilience in the long-run and equipping them to reignite their economies,” said Peter Materu, Chief Program Officer at the Mastercard Foundation.
With needs-based peer learning and innovative policies as its foundation, AFI will provide a series of technical webinars, policy documents, case studies, and guidelines in relation to the crisis response. By using online platforms provided through AFI’s well-established capacity building services, members in Africa will strengthen their crisis response through enhanced financial inclusion policies. In addition, public-private cooperation and coordination will be available through dialogue at national and regional levels to help beneficiaries address the challenges created by the current pandemic.
“The Alliance is well-positioned to deliver an effective, highly practical, and needs-based intervention that will yield significant policy outcomes and an important public good,” AFI’s Dr. Hannig underlined, adding that key gender considerations in both MSMEs and digital finance will be explored with relevant, timely, and evidence-based guidance.
For additional information, please contact:
Monika Lajhner, Head of Communications
Telephone: + 60 12 494 5038
Helen White, Strategy Lead, Program Communications
Telephone: +27 76 166 5372
AFI is the world’s leading organization on financial inclusion policy and regulation. AFI works on empowering policymakers to increase the access and usage of quality financial services for the underserved through formulation, implementation, and global advocacy of sustainable and inclusive policies.
At the offset of the pandemic, AFI launched a network-wide AFI COVID-19 Policy Response to facilitate and enable its 100-strong global membership of financial regulators from 89 developing and emerging economies to effectively respond to the financial inclusion challenges created by the pandemic. Financial regulators across AFI network are often among the few institutions in their respective countries that have the capacity to address enormous challenges of the kind that has been caused by the spread of COVID-19.
About the Mastercard Foundation
The Mastercard Foundation works with visionary organizations to enable young people in Africa and in Indigenous communities in Canada to access dignified and fulfilling work. It is one of the largest, private foundations in the world with a mission to advance learning and promote financial inclusion to create an inclusive and equitable world. The Foundation was created by Mastercard in 2006 as an independent organization with its own Board of Directors and management.