The global mobile phone and digital channels revolution has created a vital link to connect the unbanked and financially excluded to affordable financial services. These new and emerging channels are what we refer to as Digital Financial Services (DFS).
The United Nations Capital Development Fund (UNCDF) estimates that 40 percent of adults in the least developed countries have access to a mobile telephone, and that these numbers are growing at a rate of 20% per year. In contrast, access to financial services by those same adults is approximately 14% and stagnant, pointing to substantial opportunities for DFS to make a greater impact amongst the poorest people in developing countries.
Mobile Money for the Poor (MM4P) is a programme launched by UNCDF and funded in Zambia by the Mastercard Foundation in partnership with FSDZ. MM4P and FSDZ work to develop DFS to move the market forward and bring banking and other financial services within reach of the poor. We use an infrastructure approach working with stakeholders in the areas of policy and regulation, providers, distribution (expanding agent networks), high volume (creating large-scale demand), and customers (appropriate products). We support training, technical assistance and share the cost of reaching new markets and using new channels.
MM4P/FSDZ use a theory of change approach to DFS development, which focuses on making shifts between stages of market development, moving from Inception to Start-up to Expansion and eventually a mature market known as the Consolidation phase. Through each stage, MM4P/FSDZ use interventions at the Policy & Regulation, Provider, Agent, High Volume and Customer levels to improve market conditions and facilitate shifts.