Digital Finance

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Digital financial services represent a new approach to financial inclusion— they give poor families access to an array of affordable resources that make financial transactions cheaper, more secure and transparent. At the same time they help build lasting, inclusive economic infrastructure that improves governance and provide a foundation for innovative business models that offer relevant services to poor and underserved populations, helping create more resilient and self-reliant communities.

The Center for Digital Development’s Digital Finance practice works to overcome barriers preventing access to these vital services by partnering with governments, donors, the private sector, and underserved communities around the world to support financial systems and policies that increase transparency, open new and inclusive markets, and help countries on their Journey to Self-Reliance.

Partnering with Global Alliances: USAID's Contributions to Ecosystem Outcomes

The Digital Finance team conducts an annual effort to identify models or examples of success that demonstrate the achievement of the Digital Financial Services (DFS) team objectives and lessons learned for replication and scale. The team identified and evaluated the Partnering with Global Alliances case study in 2021, substantiating outcomes achieved through the team’s engagement in global alliances including the Consultative Group to Assist the Poor (CGAP), the Better than Cash Alliance (BTCA), and the RegTech for Regulators Accelerator (R2A).


Examining Virtual Currencies: Risks and Uncertainties of a Novel Payment Technology in International Development

This exploratory brief discusses the implications that virtual currencies, and to a lesser extent central bank-issued digital currencies (CBDCs), might pose for stakeholders in international development contexts. Over the last few years, the emergence of these payment innovations has elicited significant interest in their potential impact on long-standing development challenges, such as the advancement of cheap cross-border payments, financial inclusion, and inclusive digital economies. However, as this brief discusses, the capacity of these innovations to advance objectives such as these remains uncertain, underscoring the importance of due diligence and responsible, evidence-based approaches to these innovations.


How Regulators Use Sex-Disaggregated Data and RegTech to Enhance Financial Inclusion

The Digital Finance team, together with the Gender Equality & Women's Empowerment Hub, partnered with the Toronto Centre to advance the use of regulatory technology (RegTech) for women’s economic empowerment, through market-level research and consultations with four country-level financial authorities in Colombia, Kenya, Zambia, and Peru.  This study examines the role that financial regulators can play to expand financial inclusion of women. Specifically, it addresses how regulators are using, or could use, sex-disaggregated data to enhance women’s access to and use of financial products and services. The study also explores how new technologies could help foster financial inclusion.


Exploring the Use of Mobile Money Services Among Tea SACCOs in Rwanda: Challenges and Opportunities (Research Report)

The USAID Digital Finance team and the University of California Berkeley with Mount Kenya University Rwanda released the research report, "Exploring the Use of Mobile Money Services among Tea SACCOs in Rwanda: Challenges and Opportunities." This project explored the social impact of mobile money services among tea Savings and Credit Co-operatives (SACCOs) members in Rwanda, following the implementation of a payment automation project funded by Access to Finance Rwanda (AFR). The research explores the opportunities and challenges that emerged from this automation as well as potential spillovers of transitioning agricultural cooperatives to a mobile money payment system. The report includes key research findings and recommendations which are also in this short policy brief


Exploring the Use of Mobile Money Services Among Tea SACCOs in Rwanda: Challenges and Opportunities (Policy Brief)

The USAID Digital Finance team and the University of California Berkeley with Mount Kenya University Rwanda released the research report, "Exploring the Use of Mobile Money Services among Tea SACCOs in Rwanda: Challenges and Opportunities." This project explored the social impact of mobile money services among tea Savings and Credit Co-operatives (SACCOs) members in Rwanda following the implementation of a payment automation project funded by Access to Finance Rwanda (AFR). This accompanying policy brief presents the key findings and recommendations from the research.


Building Resilient and Inclusive Digital Ecosystems: A Toolkit for Using Digital Payments in Development Programs

The Toolkit is designed to be used by organizations regardless of their experience with digital payments and to inspire and enable organizations new to digital payments to make the switch. The Toolkit is a “how-to” guide divided into step-by-step modules along with associated tools to support organizations in practically applying the knowledge learned.

As with all of USAID's work, we know context matters, and local digital ecosystems and digital financial services (DFS) may not be universally available. Partners can use the Toolkit to harness opportunities to accelerate their program activities and empower individuals to become active users of DFS to manage and improve their lives. The Toolkit is structured to help partners think across the program cycle on how to evaluate local opportunities for DFS, identify weaknesses in the digital ecosystem, and design programs to optimize and advance the use of DFS market systems while adhering to the Principles for Digital Development.


2020 Digital Finance Bright Spot: Support for Market Growth with USAID/Ethiopia

The Digital Finance team has initiated an annual effort to identify examples of digital finance support at the Agency that demonstrate development outcomes catalyzed by digital finance, improved service delivery, and lessons learned for replication and scale. The Support for Market Growth with USAID/Ethiopia case study is one of the bright spots identified and evaluated in 2020, providing a possible, verified pathway for successful Mission engagement to promote a country’s Journey to Self-Reliance, support the objectives of the USAID Digital Strategy, and help catalyze a Mission’s development outcomes. The following narrative details the full USAID/Washington - USAID/Ethiopia engagement from an initial digital agriculture assessment conducted by the Digital Development for Feed the Future (D2FTF) team to the finalization of the Activity Design for the Market Systems for Growth activity.


2020 Digital Finance Bright Spot: Digital Payments in Liberia

The Digital Finance team has initiated an annual effort to identify models or examples of digital finance support at the Agency that demonstrate development outcomes catalyzed by digital finance, improved service delivery, and lessons learned for replication and scale. The Digital Payments in Liberia case study is one of the bright spots identified and evaluated in 2020, presenting a pathway, business case, and catalyzation of development outcomes for public-private partnerships in digital finance. This report provides an overview of the methods, context, verified pathway, barriers and enablers, and key takeaways from USAID’s involvement with the Government of Liberia and Lonestar Cell MTN in expanding digital payments and mobile money services in Liberia from 2014 to present day. 


India Digital Financial Inclusion: Journey Map Report

Since 2014, India has embarked on one of the most ambitious financial inclusion initiatives ever seen anywhere in the world, bringing over 330 million people into the formal financial sector. This report tells the story of this growth. It dissects the major trends and drivers behind them, identifies key actors and the roles that they have played, and presents a roadmap for how the next phase of digital financial inclusion in India can be made more effective and more inclusive. The report, commissioned by USAID through the Mobile Solutions Technical Assistance and Research (mSTAR) project, takes into account field research with users and providers of digital financial services, as well as interviews with senior experts in government, the development sector and the financial sector.


FinTech Partnerships Playbook

This playbook is meant to equip USAID staff and implementing partners to develop and pursue effective private sector engagement (PSE) in the context of digital finance/FinTech and financial inclusion. The playbook is intended to be a tool for brainstorming during program design and PSE as USAID Missions develop programming related to inclusive digital economies.


Digital Financial Services Accelerate the Journey to Self-Reliance

Digital financial services offer development practitioners the tools and systems they need to achieve sustainable, inclusive economies in the countries in which they operate. Through the use of these services and the implementation of policies that support them, countries can increase financial inclusion, build markets, create jobs, empower women and youth, and further their journeys toward self reliance.


The Role of Digital Financial Services in Accelerating USAID's Health Goals

Digital financial services (DFS) provide health programs with opportunities to accelerate progress toward global health goals and outcomes. By leveraging DFS, United States Agency for International Development’s (USAID) global health program managers can improve health systems performance and support programmatic outcomes such as financial protection for vulnerable groups, delivery of essential health services, improved reach to marginalized communities, and increased health service demand and responsiveness.


Primer on Blockchain 

With all of the hype around blockchain and other distributed ledger technologies (DLTs), it can be difficult to determine how they can be applied in international development contexts. This primer aims to provide international development practitioners with the information and questions needed to assess if and how DLTs like blockchain can be used to support their programs.


RegTech for Regulators Accelerator 

RegTech
Patrick Drown

In partnership with the Bill and Melinda Gates Foundation and Omidyar Network, USAID launched RegTech for Regulators Accelerator (R2A) to catalyze innovation and create a market for technology-enabled tools that enhances the capacity of financial sector regulators and reduces the compliance burden of the private sector.


Partnering to Create an Inclusive Digital Economy 

As part of the Agency’s partnership with India’s Ministry of Finance, USAID’s Digital Finance practice helped launch the India Catalyst Program. This program seeks to realize an inclusive digital economy for all in India, especially low-income populations, through affordable, scalable digital payments and tools.

 

Last updated: August 25, 2021

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