The Tribune

By JIMENA ELIA

Country Manager for West & Dutch at Mastercard

MUCH has been written recently about financial inclusion, its impact on world economies, and how it is rooted in empowerment when financial tools and credit are accessible and become facilitators of positive social and economic outcomes.

However, the latest data provided by Mastercard and Americas Market Intelligence report, "The State of Financial Inclusion Post COVID-19", highlights the prevalent gaps in access to the financial system in Latin America and the Caribbean, where 26% percent of adults still do not have an account.

Around the world, "cash is king" as it still accounts for a high percentage of all transactions. Even though it is tangible and immediate, it can be hard to track and is highly vulnerable.

It is not just about having an account but rather about using it. Usage is a challenge in many countries, where large segments of the population may have an account but still use cash to pay for everyday daily necessities, and ownership of specific products such as credit cards or loans only reaches certain segments of the population in urbanised areas.

To counter this reality and achieve the goal of financial inclusion, we must strive to have a network of concurrent transactions that adequately integrates all actors in the ecosystem, including Fintechs. Technology is a great democratiser; innovative partnerships and scalable solutions can transform systems and lives.

The rapid growth of Fintechs in the region positively impacts how people access financial services, offering new digital user experiences, lower fees, access to e-commerce, and digital financial education. The Inter-American Development Bank published a study indicating that the size of the Fintech sector in Central America and the Caribbean had doubled in just three years. By 2021, the region already had 2,482 Fintech platforms, accounting for 22.6 percent of all Fintechs in Latin America.

The Bahamas is one of the most prosperous countries in the Caribbean. Thus, it is not a surprise that it also has one of the most vibrant Fintech sectors in the region, given its vastly advanced digital environment, which has been actively encouraged by the Bahamian government through an encompassing Digital Agenda. On august 23rd, Mastercard will host the first ever Mastercard: Fintech Summit. Leaders of the technology sector, financial services industry, non-profit organisations focused on innovation, and government representatives, will gather to discuss growth opportunities for the Caribbean Fintech ecosystem and highlighted the positive impact they have in terms of financial inclusion and literacy, encouraging innovation, and granting Caribbeans access to safe, convenient, and easy digital financial experiences.

In 2021, we reached the 100 million digital cards milestone through partnerships with 100 Fintech companies in Latin America and the Caribbean (LAC). In addition, we are helping governments embrace digital technologies to deliver payments and better serve their communities through innovative partnerships, leading-edge technology, and critical insights powered by smart aggregated data to make more efficient decisions while expanding inclusion.

Mastercard continues to innovate and diversify, offering a wide range of solutions, products, and programs for startups, as well as a broad network of partners and subject matter experts ready to assist financial technology companies and payment developers in bringing their bold ideas into reality.

In the Caribbean region, Mastercard has established partnerships with various local organisations and government agencies to promote the growth of the Fintech sector; some examples include Neo Banks such as Qik in the Dominican Republic and Sagicor Digital Bank in Barbados; digital payment platforms like Girasol Payments in Curacao, Wipay in Jamaica, Dynamic Payments and GCS in the Dominican Republic, and even Caribbean-focused e-commerce marketplaces like Caribshopper.

To increase awareness and understanding of what Fintechs are and how they operate, Mastercard has also hosted events and workshops, elevating their knowledge of their benefits in improving financial inclusion, encouraging innovation, supporting the growth of an entrepreneurial mindset, and increasing financial literacy.

By adopting a similar multi-stakeholder approach in The Bahamas over the short, medium, and long term, Mastercard will play a vital role in creating an enabling environment for Fintechs to thrive, thereby driving the region's economic growth and development.

The most significant impact comes when entities decide not to deal with a challenge independently but instead rely on public-private and private-private partnerships. At Mastercard, we will continue working on solutions and strategic partnerships with all actors in the ecosystem, fostering financial inclusion and prosperity in the Caribbean. We can help move people toward financial security and thus build a more inclusive, safer, and prosperous future for all.