SEATTLE, WASHINGTON, D.C. — The Bill & Melinda Gates Foundation and the U.S. Agency for International Development (USAID) today announced a $10 million incentive fund to jumpstart financial services by mobile phone in Haiti and expedite the delivery of cash assistance to victims of the country’s devastating earthquake by humanitarian agencies. This initiative lays the foundation for advanced banking services that could help millions of Haitians lift themselves out of extreme poverty.
Enabling Haitians to send, receive, and store money using their mobile phones has the potential to dramatically improve their lives and leapfrog more conventional banking models to safer, more affordable alternatives. Often called “mobile money,” these services reduce the risks and costs of financial transactions, help increase savings, and generate employment. They also help connect people to difficult-to-access vital services like banking, insurance, and utilities.
“Out of the ruins of Haiti’s tragic earthquake, there is an unprecedented opportunity to improve the lives of millions of Haitians and unlock the country’s economic potential through mobile money,” said Mark Suzman, acting president of the Global Development Program at the Bill & Melinda Gates Foundation. “Making financial services widely available to the poorest families in the developing world can help break the cycle of poverty by giving them a safe place to save, guard against risks, build assets, and provide opportunities for the next generation.”
”This partnership provides a unique opportunity to put much-needed cash in the hands of Haitians as they continue to advance on the long road to recovery,” said USAID Administrator Dr. Rajiv Shah. “Before the earthquake, fewer than 10 percent of Haitians had ever used a commercial bank. A mobile money system can restore and remake banking in Haiti and serve as an engine of inclusive growth.”
Shah noted that in other countries’ experience with mobile banking, users start keeping money on hand in their mobile “wallets” for emergencies, setting up a pattern of savings that leads to other benefits. “Encouraging savings and increasing access to credit through these mobile services will help Haitian families improve their financial stability and look toward a better future,” said Shah.
The fund will offer cash awards to companies that initiate mobile financial services in Haiti. The first company to launch a mobile money service that meets certain criteria in the next six months will receive $2.5 million. The second operator to launch and reach these benchmarks within 12 months will receive $1.5 million. Another $6 million will be awarded as the first 5 million transactions take place, divided accordingly between those operators that contributed to the total number of transactions.