Barclays to assist 60,000 people in Africa anti-poverty effort
New York and London — Around 60,000 people in Kenya, Ghana, Tanzania and Uganda will soon have access to financial services through Barclays’ commitment to the Business Call to Action (BCtA) ―a global initiative aimed at supporting the private sector’s efforts to fight poverty.
Barclays’ pledge is part of the bank’s three-year, £10 million Banking on Change initiative, which seeks to improve the quality of life for poor people by extending and developing access to basic financial services in 11 countries in Africa, Asia, and South America, working in partnership with CARE International and Plan International.
“Extending access to banking and financial services within low-income communities allows poor people to manage their money more efficiently and effectively and creates new opportunities for inclusive economic growth,” said Natalie Africa, Programme Manager of the Business Call to Action. “In Africa, where up to 80 percent of the population is under or un-banked, this initiative has the potential to overcome some of the most significant barriers to financial inclusion and sustainable development.”
Through Banking on Change, Barclays, CARE International and Plan International are supporting financial inclusion of low-income communities primarily through Village Savings and Loan Associations, and by providing low-income communities with advice and training on how to manage their accounts.
Members pool savings into an interest-bearing fund from which they can then borrow. They also vote on how many loans are disbursed, their amounts and their repayment dates. The associations, which average 10 to 30 members, are located in areas not typically serviced by banks.
Through the BCtA commitment, Barclays will support around 60,000 low-income customers in the associations to graduate to the formal financial sector by providing special banking accounts customised to fit the specific needs of these groups.
By helping these groups to put their savings in additional interest-bearing, no-minimum deposit accounts, Barclays is making the process of saving money safer and more efficient for qualifying associations.
Association members can be assured that their savings are kept in a secure place and detailed transaction information helps them keep better track of account history. Furthermore, Barclays provides customers with specialised support in account management.
“For Barclays, the Banking on Change initiative isn’t just a philanthropic exercise —it has real commercial and business value,” said Chen Wong, Banking on Change Programme Manager for Barclays. “Through this commitment to the Business Call to Action, we will work with CARE and Plan to develop a robust microfinance model which is capable of being scaled up and rolled out across different countries. This initiative will help pave the way for formal financial services in the future.”
Launched in September 2008, the Banking on Change programme has formed 5,000 Village Savings and Loan Associations across 11 countries and enabled 99,629 people to have access to savings-led community financial services.
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