The International Finance Corporation (IFC), the private lending arm of the World Bank Group, has signed an advisory services agreement, valued at US$3.9 million, with Airtel Uganda to expand access to mobile financial services throughout the country, Pyramid Research said Wednesday in its daily update.
“The initiative is expected to strengthen financial inclusion in Uganda, where just over half of the adult population has access to formal financial services, leaving the other half to the risks of informal cash savings and credit,” said the update quoting CPI International.
The aim of the three-year project is to assist Airtel Money Uganda in strengthening its mobile money operation to increase the number of its active customers.
According to the report, these customers will include rural and underserved communities and women. IFC will provide advisory services on agent network management and product development, funded by the Bill & Melinda Gates Foundation.
Chidi Okpala, Director and Head of Airtel Money Africa, said: “We are quite pleased with this support from IFC and the Bill & Melinda Gates Foundation. It will help us to further strengthen our distribution capability and involvement in deepening access to financial services and the creation of cashless ecosystems in Uganda.”
Implementation of mobile financial services has shown to be a successful way of increasing access to financial services, and thus an important tool in the fight against poverty and the promotion of inclusive economic growth.
In Tanzania, recent FinScope data show that the use of mobile money services has helped increase the rate of financial inclusion from 15.8 to 57.4 percent in just four years.
“The lack of access to formal financial services means many Ugandans have no safe or sustainable way of saving or transacting money. Mobile money offers great potential in extending formal financial services also to the low-income market, and our partnership with Airtel Uganda will further that cause,” said Greta Bull, IFC Head of Micro Retail Advisory Services in Sub-Saharan Africa.