New Report: How the Development Sector is Channeling Money to Digital Financial Services
This new report from The Mix and CFI-Accion provides information to guide funders’approaches to support the development of reliable and effective digital financial services for the benefit of low-income populations.
Development funders – bilaterals, multilaterals, development finance institutions and private foundations – are more and more harnessing digital financial services (DFS) to promote financial inclusion. But until now, there was no systematic way of understanding how much funding was committed to DFS and where it was going. Therefore, The Mix and CFI-Accion developed a methodology to identify, classify and measure the funding flows going to DFS. The goal of the project is to help the inclusive finance sector to better coordinate, and identify new pathways for funding the sustainable development of digital financial services for financial inclusion.
The report highligts 4 key findings:
USD 1.95 billion: Development Funders’commitment as of the end of 2018 in supporting digital financial services
Most DFS funding is going to sub-Saharan Africa but not necessarily to the countries with the lowest levels of financial inclusion
Development funding to financial service providers is moving away from traditional players like banks to fintech
DFS projects are mostly sub-set of financial inclusion projects but it is changing: “digital finance is increasingly being mainstreamed in broader digital development work”.
