Malawi has started creating a digital payment ecosystem in order to address poverty and drive inclusive growth. An event organised by the Government of Malawi with the United Nations Capital Development Fund’s (UNCDF) Better Than Cash Alliance and Mobile Money for the Poor initiatives brought together digital payments players to accelerate the progress of digital finance in Malawi.
The convening also released an in-depth analysis of the country’s readiness to transition from a nearly cash-only economy to one where digital payments are widely available through an ecosystem approach.
The research was conducted through a partnership between the Malawian Ministry of Finance, the Reserve Bank of Malawi, and the Better Than Cash Alliance. It detailed the current state of Malawian digital payments and identified four potential opportunities for Malawi, including the Government advancing on digitising its centralised payment system with support from banks, and merchants accelerating digital payment acceptance via mobile money and debit card at the point of sale.
Goodall Gondwe, MP, Minister of Finance, Economic Planning and Development of Malawi, said that the transition to digital payments is part of the Government’s commitment to achieving social and economic goals within the Malawi growth and development strategy.
“This is part of our mandate to realise balanced and sustainable economic growth and to reduce poverty. We believe creating an economy where digital payments are widely available is the right path for us to embark on and we are doing so based on sound economic and fiscal policies,” Gondwe added.
According to UNCDF, in least developed countries such as Malawi mobile penetration is at 30% while access to a bank account is at 14%. Mobile payments can therefore be one way to accelerate this shift.
Doug Arbuckle, Malawi Mission director of USAID said: "The U.S. Government is glad to join many other governments and international organisations in encouraging a transition away from cash to digital payments in Malawi. This can be a long road, but the benefits are clear and overwhelming."
Mia Seppo, United Nations resident coordinator and United Nations Development Programme resident representative, added: “The introduction of digitisation is timely as Malawi is currently going through public service reforms that will ensure equitable access to financial and payment services in a manner that is transparent and efficient.”