Mastercard Incorporated MA recently joined forces with the development finance institution, U.S. International Development Finance Corporation (DFC), consequent to the conclusion of the U.S.-Africa Leaders Summit.
The tie-up will extract an investment of up to $50 million from DFC toward organizations that can be financial institutions, agricultural and technology companies or other businesses but have to be a part of the Mastercard’s Community Pass network. The digital platform, Community Pass, was devised in a manner to counter infrastructure headwinds that often crop up in an effort to digitize rural areas.
The challenges might often relate to unsecure connectivity, less usage of smartphones and, the inadequacy of consistent identification of credentials.
Investment from a public sector company like DFC, when integrated with the prowess and technology of a tech giant like Mastercard, is an apt example of an initiative to enable businesses across rural areas to embrace the ongoing digitization trend.
Among the multiple benefits offered through the tie-up, increased access to digital tools, which is essential to growing one’s business or injecting financial security within operations, remains a noteworthy endeavour of the latest move.
The recent partnership marks yet another effort on the part of Mastercard to grow its Community Pass platform, which boasts a continuously expanding footprint across five African countries of Kenya, Tanzania, Uganda, Mozambique and Mauritania. MA targets to serve 15 million Community Pass users throughout the continent within 2027.
Initiatives similar to the latest one also reinforce Mastercard’s motive of capturing a significant share of the digital economy of the continent of Africa, which continues to witness an emergence of digital technologies and substantial foreign investments. In September 2022, MA collaborated with the financial technology company Prophius to expand the reach of the contactless acceptance solution, PayContactless, to benefit the small businesses of Sub-Saharan Africa.
Coming back to the summit, at the end of which the MA-DFC collaboration was announced, one of the digital payments leaders, Visa V unveiled plans to invest $1 billion in Africa over the next five years to capitalize on the continent’s rapid growth in the digital payment market.
Shares of Mastercard have gained 11.3% in the past six months compared with the industry’s 4% growth.
