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In keeping with its resolve to grow financial inclusion worldwide, the Bill and Melinda Gates Foundation has unveiled a new software solution targeted at helping the unbanked people around the world access digital financial services.
The software, Mojaloop, is designed to fasten the penetration of financial inclusion especially in developing economies, and it has been categorized as an open-source software for creating payment platforms.
The design came with interest to provide a reference model for payment interoperability between banks and other providers across a country’s economy.
According to the foundation, Mojaloop is available now, free-of-cost, for software developers to adapt and banks, financial service providers and companies to implement. Information on the code can be found at mojaloop.io.
Latest data from the World Bank shows that nearly two billion people in developing economies lack bank accounts and miss out on the benefits and security that basic financial services provide, the Gates Foundation opined that global expansion of these services—especially to the world’s poor—has been hampered, in large part, by a lack of interoperability between digital financial services and payment platforms.
During the launch, Bill and Melinda explained that it establishes a blueprint for connecting today’s financial services sector, and can be used as a solution to barriers that banks and providers seeking interoperability have traditionally faced.
The foundation further noted that delivering financial services to the poor is prohibitively challenging for many businesses because they struggle to invest adequately in complex technology while maintaining a commitment to low-cost, inclusive services.
Mojaloop can be used by financial institutions and commercial providers, to simplify and reduce the cost of developing inclusive payment platforms.
The Gates Foundation added that the solution was designed to serve ultimately as a model for national payment switching systems that, for example, enable an individual’s digital wallet to connect with her employer’s bank account and her children’s school account to complete monthly transactions. The code can also be applied to adapt and improve existing services.
Deputy Director, Financial Services for the Poor, at the Gates Foundation, Kosta Peric, said interoperability of digital payments has been the toughest hurdle for the financial services industry to overcome.
In his submission, “With Mojaloop, our technology partners have finally achieved a solution that can apply to any service, and we invite banks and the payments industry to explore and test this tool,” he averred.
Continuing, he said “Just as the Internet revolutionized digital communication, open-source solutions like Mojaloop can spark innovation and democratize access to digital payments, empowering billions of new customers and driving massive economic growth in developing markets”.
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