12-07-2022  9:48 am   •   PDX and SEA Weather
By The Skanner News | The Skanner News
Published: 22 September 2009

SEATTLE (AP) _ The Bill & Melinda Gates Foundation, best known for its work combating malaria, AIDS and other diseases, announced an effort this week to bring banking, including savings accounts, to the poor.
It may be hard to understand how savings is even an issue for the people who live on less than $2 a day, said Bob Christen, who directs the Gates Foundation's financial services initiative. However, access to a safe place to store money is a top priority of poor people around the world, he said.
That's why the world's richest charitable foundation announced a $35 million grant to help facilitate agent banking services already being developed in Africa, Asia and South and Central America.
Christen said the Gates grant will provide assistance to numerous organizations through the Alliance for Financial Inclusion, whose efforts are historic in the world of banking, and will help people climb out of poverty, save for their children's education, build their businesses and plan for the future.
The ideas for bringing savings accounts, insurance and other financial services to the poor include transferring money by way of mobile phones and setting up banking kiosks in markets and post offices.
The Gates Foundation has invested a total of $350 million so far in other financial services for the poor, including micro-credit, which involves small loans for poor entrepreneurs.
Christen says savings accounts are a more basic need of many people. An estimated 2.5 billion people -- more than half the world's adult population -- do not have access to savings accounts and other financial services.
People are forced to buy and pawn jewelry or make other poor investments to keep their money safe.
Foundation research identified this as an area that is not getting investment dollars and turned its attention in this direction.
"It became very obvious that the single service that is least developed that most people need is savings," Christen said. "People really want to be able to save in a safer place."
The Gates Foundation is providing an infusion of cash to facilitate the sharing of ideas among the innovators and to make sure the new systems offer a wide range of financial services.
Alfred Hannig, executive director of the Alliance for Financial Inclusion, said banking innovation is happening in developing countries without the foundation's help, but the money will help speed implementation.
The alliance has a goal of reaching 50 million of the world's "unbanked" by 2012.
In a phone call from Nairobi, Kenya, where the alliance was hosting a meeting for representatives of 42 countries, Hannig said that plans are being made for a delegation from Kenya to go to Brazil to learn about that country's efforts to bring banking services to small villages along the Amazon River.
"People were waiting for this," said Hannig, who works for the German Technical Corporation and is based in Thailand. "This was very timely. They have been waiting for such a mechanism for such a long time."
Hannig said 60 percent of the money from the Gates Foundation will be redistributed in smaller grants to groups like the delegation from Kenya to Brazil, and the Bank of Thailand, which wants to measure banking access around the world through a survey.
He predicted that the ideas percolating in Africa, Asia and South and Central America will leap frog existing systems in Europe and the United States.
For example, banking in industrialized nations is paper-based -- people still use checks and cash for most of their financial transactions. The new technologies being tried out in the southern continents will lead to a paperless, cashless system.



Recently Published by The Skanner News

  • Default
  • Title
  • Date
  • Random

Photo Gallery

Photos and slide shows of local events