Melinda Gates Challenges Global Leaders: Create Savings Accounts and Bring Financial Security to the World's Poorest

By Bill Melinda Gates Foundation, PRNE
Monday, November 15, 2010

Heads of government, banking, technology, and international development gather for first-ever Global Savings Forum; foundation pledges $500 million and announces new grants to increase access to savings

SEATTLE, November 16, 2010 - Melinda French Gates, co-chair of the Bill & Melinda Gates Foundation,
today hailed a historic moment that will help bring financial services,
particularly savings accounts, to hundreds of millions of people living on
less than $2 a day. Speaking at the foundation-hosted Global Savings Forum in
Seattle, the first global gathering focused on the role of savings in the
developing world, Gates urged leaders in government, banking, mobile
communications, and international development to work together to build a new
kind of financial infrastructure to bring savings to the poor. She also
pledged $500 million from the foundation over the next five years to expand

"This is an amazing moment. The stage is set for incredible
breakthroughs," Gates told nearly 200 influential world leaders who gathered
for the two-day forum. "As last week's statement on savings by the G20
proves, financial inclusion is on the global agenda at the highest level. And
innovations are happening so fast that, for the first time, the world has the
opportunity to provide even the poorest people with access to financial

Savings accounts are in great demand by the poor in the developing world.
Research shows that when they are offered side by side with loans, people
chose savings over loans at rates of up to 12:1. In one study, Malawian
farmers who were given the option to put aside some of their earnings toward
the next planting season increased their farming inputs by 64 percent,
resulting in 54 percent higher farm revenues, and 30 percent higher
day-to-day expenditures. New research also shows that safe savings options
can empower women, help people manage risks, like illness and job loss, and
increase investment in livelihoods. Still, less than 10 percent of the
world's 2.5 billion poor have access to formal financial tools.

"Savings doesn't just help people mitigate the risks posed by a medical
emergency or a bad crop," said Gates. "It also gives them the ability to
marshal their resources to build something better for themselves and their
children. It allows them to fund their own businesses, to look ahead with
confidence. Savings helps families to take the giant leap from reacting to
events to planning for a healthier, happier future."

Gates was joined by influential leaders who discussed the vital role
financial services play in improving the lives of the poor, including Her
Royal Highness Princess Maxima of the Netherlands, U.N. Secretary General's
Special Advocate for Inclusive Finance for Development.

"I am a strong believer in the power of financial inclusion," said
Princess Maxima. "When financial services are provided properly, they can
help people grow their businesses, shield themselves against unforeseen
shocks and make better lives. And I cannot stress enough the importance of
savings accounts. Savings is a debt-free way to make investments and take
advantage of opportunities, whether starting a business or sending a child to

As a part of the foundation's $500 million pledge, Gates announced a
package of six new grants totaling $40 million. The grants support projects
and partnerships to improve access to savings and other financial services,

    - Expansion of bank and microfinance services to include savings accounts
    - Implementation of new approaches to reach the poor with savings, such
      as branchless banking and mobile money
    - Research to identify how people use formal and informal financial
      tools, including savings, credit, insurance, and payment services, and
      to analyze the impact of financial services on the lives of the poor

Technologies such as mobile phones are already providing safe, reliable,
and easy options for people to access financial services. Sixty-nine percent
of the developing world already has a mobile connection, and this number is
expected to climb to 98 percent within five years.

"Technologies like mobile phones are powering a next-generation banking
system," said Chris Locke, managing director of the GSMA Development Fund.
"We now have the opportunity to put this to work for the developing world,
offering the poorest people tools to manage their assets and build financial

Other leaders who joined Gates included Janamitra Devan, vice president
and head of network, financial, and private sector development for the World
Bank-International Finance Corporation (IFC); Njuguna Ndung'u, governor of
the Central Bank of Kenya and steering committee chair of the Alliance for
Financial Inclusion (AFI); Chris De Noose, managing director, World Savings
Banks Institute; Yongbeom Kim, director general of Global Financial
Architecture Bureau in the Presidential Committee for the G20 Summit; and
Luis Urrutia, president, Financial Action Task Force.

The foundation's Financial Services for the Poor initiative is working
with a wide range of public and private partners to harness technology and
innovation to bring quality, affordable, and safe savings accounts and other
financial services to the doorsteps of the poor in the developing world.
Since 2006, Financial Services for the Poor has already committed more than
$530 million to explore ways to increase access to financial services.

This announcement includes the following grants.

    World Savings Bank Institute (WSBI) (2010-2011)
    Doubling Savings for the Poor: $600,000

    WSBI will work with major savings banks in developing countries to double
    the number of savings accounts held by poor people. Building on a $20
    million grant to WSBI given in 2008, the program will identify and define
    viable projects that could be supported to offer affordable, accessible,
    and sustainable savings accounts with approximately 10 additional WSBI
    member banks.

    Press Contact
    Dirk Smet, +32-2-211-11-90,

    Vodacom Tanzania Limited (VTL) (2010-2012)
    M-PESA Tanzania Acceleration Opportunity: $4.8 million

    This program aims to increase awareness and usage of the mobile money
    service, M-PESA, in Tanzania, reaching at least 2 million people in 18
    months. It looks to improve the lives of millions of Tanzanians, much
    like M-PESA is doing in Kenya.

    Press Contact
    Mwamvita Makamba, +255-754-706-642,

    ShoreBank International, Ltd. (2010-2012)
    bKash Mobile Money Platform: $10 million

    This project will work with BRAC Bank Limited to build bKash, a scalable
    mobile money platform that will allow poor Bangladeshis to store,
    transfer, and receive money safely via their mobile phones. Within five
    years, the project aims to bring 17.5 million poor people into the formal
    financial system for the first time ever.

    Press Contact
    Nicholas Molodyko, +1-312-881-5806,

    Consultative Group to Assist the Poor (CGAP)/International Bank for
    Reconstruction and Development (IBRD) (2010-2013)
    CGAP II Technology Program: $6 million

    Building on a major grant in 2006, this program will promote the use of
    branchless banking to increase the number of poor people with access to
    financial services, particularly savings. Co-funded by the United
    Kingdom's Department for International Development and the World Bank,
    the program includes an innovation fund to support promising approaches
    and advises banks, microfinance institutions, telecommunication
    providers, and financial regulators on effective design and regulation.

    Press Contact
    Jeanette Thomas, +1-202-473-8869 or +1-202-744-4829,

    World Bank (2010-2014)
    Global Financial Inclusion Survey: $11.4 million

    This program will include 10 financial questions in an existing Gallup
    global poll to generate first-of-a-kind baseline data on financial
    inclusion levels across 150 countries. The survey will be issued every
    three years to measure and track specific data on people's use and access
    to formal and informal banking, and financial tools.

    Press Contact
    Merrell Tuck-Primdahl, +1-202-473-9516,

    Yale University/Innovations for Poverty Action (2010-2014)
    The Microsavings & Payments Innovation Initiative (MPII): $7 million

    The MPII will strengthen understanding of the financial needs of the
    poor, and the economic benefits of financial products by launching more
    than 20 studies to identify the best ways to reach the poor with savings
    products and money transfer services. To support this effort and build
    capacity in developing countries, the program looks to expand its research
    network to include at least 15 more developing country researchers

    Press Contact
    Dorie Baker, +1-203-432-8553,

Note to Editors

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Bill & Melinda Gates Foundation

Guided by the belief that every life has equal value, the Bill & Melinda
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