Better Than Cash Alliance: Advancing Digital Payments
The Better Than Cash Alliance is a global partnership of governments, companies, and international organizations that aims to help people move from physical cash to digital payments. It was established in 2012 and is based in the United Nations Capital Development Fund in New York City.
Reasons for Creating the Better Than Cash Alliance
It was created in response to a number of economic, social, and environmental challenges faced by developing countries that heavily rely on cash-based transactions.
These challenges include high transaction costs, security issues related to cash, and limited access to financial services for the unbanked.
By transitioning to digital payments, the alliance seeks to address these issues and improve access to financial services, foster economic growth, and enhance transparency.
By promoting digital payments, the Better Than Cash Alliance aims to promote financial inclusion, economic growth, and poverty reduction.
Who Makes Up the Better Than Cash Alliance?
Founding Partners
It was founded by the Bill & Melinda Gates Foundation, Citi, Ford Foundation, Mastercard, Omidyar Network, The United States Agency for International Development, and Visa Inc.
The U.N. Capital Development Fund serves as the secretariat, which means it’s a permanent administrative office or department and it acts as the lead organizer to ensure all members of the alliance are working together efficiently in their goal of moving towards digital payments.
Members
The members are made up of more than 75 members from different parts of the world. These members are made up of governments, private sector companies, development organizations, and civil society organizations.
Governments
Several governments have joined the Better Than Cash Alliance, including Colombia, Mexico, Peru, and India. These countries have recognized the benefits of digital payments and are working with the Better Than Cash Alliance to promote their use.
Private Sector Companies
The Better Than Cash Alliance has also attracted some of the world’s largest private sector companies including Visa, Mastercard, Ford Foundation, Citi, Coca Cola, and more. These companies have recognized the value of digital payments for their businesses and are helping to spread awareness of the benefits of digital payments.
Development Organizations
Development organizations including the United Nations Development Program (UNDP), International Finance Corporation (IFC), and World Wildlife Fund (WWF) have joined the Better Than Cash Alliance. These organizations work to alleviate poverty and promote sustainable development, and recognize the important role digital payments can play in achieving these goals.
Civil Society Organizations
Several civil society organizations such as Oxfam and Women’s World Banking have joined the Better Than Cash Alliance. These organizations work to promote social justice, poverty reduction, and gender equality. By promoting digital payments, they are helping to increase financial inclusion and provide better access to financial services for people who are often excluded.
By bringing together a diverse group of members, the Better Than Cash Alliance is able to work collaboratively to achieve its goals. Members of the alliance share knowledge and best practices, in addition to providing support to promote the transition towards digital payments.
Supporters
In addition to its members, there are many organizations around the world that support the idea of moving to digital payments as well.
These supporters are committed to the mission of promoting digital payments around the world and some of them include the following:
United Nations (UN)
The United Nations is one of the biggest supporters. The UN provides support through its various agencies, including the UN Development Program (UNDP) and the UN Capital Development Fund (UNCDF), which serves as the secretariat for the Better Than Cash Alliance.
World Bank Group
The World Bank Group is another major supporter. It is a global organization that provides financing, advice, and research. The World Bank Group shares the vision of promoting digital payments to promote financial inclusion and economic growth.
International Telecommunication Union (ITU)
The International Telecommunication Union is a specialized agency of the United Nations and a global leader in telecommunications and information and communication technology (ICT) development. ITU supports the Better Than Cash Alliance by collaborating on issues related to digital payments and promoting communication technologies that enable digital payments.
Alliance for Financial Inclusion (AFI)
AFI is a global organization that brings together policymakers and regulators from developing countries to promote financial inclusion policies and exchange experiences and knowledge in the field. The Alliance for Financial Inclusions supports efforts to promote financial inclusion through digital payments.
Consultative Group to Assist the Poor (CGAP)
The Consultative Group to Assist the Poor is an independent think tank dedicated to advancing financial inclusion around the world. CGAP shows support by providing research and policy advice related to financial inclusion and digital payments.
By gathering support from these organizations, the Better Than Cash Alliance is able to achieve its mission of promoting digital payments and reducing reliance on cash-based transactions. These supporters provide expertise and resources that help the Alliance to achieve its objectives.
Reasons for Creating the Better Than Cash Alliance
Economic reasons
To promote digital payments and reduce reliance on cash-based transactions. This is important because cash-based transactions are often slow, costly, and difficult to track. By promoting digital payments, the Better Than Cash Alliance is helping to boost economic growth and increase financial inclusion.
Social reasons
Digital payments can help to promote social inclusion. For example, digital payments can be used to pay social benefits, such as pensions and healthcare payments, to people who would otherwise struggle to access these services.
Environmental reasons
To promote digital payments as a means of reducing reliance on paper-based transactions. This is important because paper-based transactions contribute to deforestation, and the production and disposal of paper leads to greenhouse gas emissions.
Achievements of the Better Than Cash Alliance
Increased financial inclusion
The Better Than Cash Alliance has helped to increase financial inclusion by promoting digital payments. By reducing the need for cash-based transactions, the Better Than Cash Alliance is promoting financial inclusion for people who may not have access to formal banking services.
Reduced costs
The Alliance has helped to reduce the cost of transactions. Digital payments are often cheaper than cash-based transactions because they do not require a physical exchange of money.
Improved transparency
They have also helped to improve transparency by making transactions more visible and traceable. This is important because it can help to reduce corruption and increase accountability.
Future of the Better Than Cash Alliance
Expansion plans
The Better Than Cash Alliance plans to expand its membership and continue to promote digital payments. The organization is working to establish partnerships with governments and private sector companies to help promote digital payments.
Long-term goals
The Better Than Cash Alliance has set long-term goals to continue promoting digital payments and reducing reliance on cash. The organization aims to help 100 million people transition to digital payments by 2025.
Challenges and opportunities
The Better Than Cash Alliance faces several challenges and opportunities as it continues to promote digital payments. One of the main challenges is the need to educate people about the benefits of digital payments. However, the organization also has opportunities to collaborate with governments and private sector companies to promote digital payments.
Conclusion
The Better Than Cash Alliance is a global partnership working to promote digital payments for financial inclusion, cost reduction, and improved transparency. Since its establishment in 2012, it has achieved significant success towards its goals, including increased financial inclusion and transparency, and reduced transaction costs.
The Better Than Cash Alliance aims to transition 100 million people to digital payments by 2025, which requires the support of governments, private sector companies, and civil society organizations globally. These goals can be achieved through innovation and scaling up of digital payment infrastructure.
The Better Than Cash Alliance welcomes support from individuals and organizations with a shared commitment to financial inclusion, cost reduction, and better transparency. Together, we can create a more inclusive society with better access to financial services, efficient transactions, and a sustainable future.