Fintech and Financial Inclusion: How e-wallet Solution is Powering Startups in Jordan

Posted January 16, 2020

Amman- Winners of funding from the Heart of Amman initiative received training on financial management via e-wallets as part of the UNDP financial inclusion principles applied across all Livelihood support project. The Heart of Amman initiative aims to increase socio-economic self-reliance and livelihoods and strengthen the engagement of all local community actors of the downtown Amman, including Jordanians and Syrian refugees, in the development of their local communities.

The winners opened e-wallets with the support of the National Microfinance Bank, a microfinance institution which supports access to finance for mainly nonbankable individuals. Startups will receive all their financial disbursement in a way that ensures inclusivity, saves time and guarantees security over the classical physical cash-out.

E-wallets is an effective tool to respect the privacy for recipients as well as to make sure that the transferred amount is delivered directly to the beneficiary’s personal e-wallet account.

As part of UNDP’s effort to support gender equality, this tool assures that female’s participants are receiving their incentives and have access to benefit from them with no harm or interference from other family members. It also responds to the project’s objectives of enhancing the saving schemes of people since they’re not physically keeping their cash in hand and they’re having access to cash via their e-wallets.

Samira Khalaileh is one of the winners. Her project “Super Peanuts” packages peanuts and makes natural peanut butter with honey. It is one of the premier projects in Jordan to make natural peanut butter and distribute it nationally and regionally.

“My e-wallet will help me manage my finances and pay bills online instead of going to the bank. I now have a much better control over my spending,” said Khalaileh, who’s project is based out of her hometown of Mafraq.  

Khalaileh added that the e-wallet will enable her to meet the basic requirements of her startup in her neighborhood without having to travel to a nearby city to visit the bank.

Since the majority of UNDP beneficiaries under the livelihoods programmes are non-bankable, vulnerable or poor, they lack access to bank and cash transfer transactions. Accordingly, the UNDP utilized the mobile cash transfer services through opening an individual e-wallet for each beneficiary. This also enabled UNDP to ensure the quality of support to the beneficiaries through for example disbursement of investment funds in payments linked to the progress in the implementation of their business plans.

UNDP-supported livelihoods and employment programmes target the vulnerable and the poor who reside in remote areas where the banking system is not present or the geographic coverage is limited. The low value physical or traditional cash payment methods are costly and come with the disadvantages of increased administrative process and financial risks.

Accordingly, UNDP Jordan relied on integrating innovative solutions for efficient and effective livelihoods and employment creation programmes. Mobile wallets services are utilized by UNDP for cash transfer and distribution to the beneficiaries. Purpose of these payments is to support the employment-seekers and entrepreneurs to receive their financial dues of both incentives and tranches of investment capital.

UNDP Digital Strategy charts a course to leverage digital innovation and solutions enhancing the quality, efficiency and effectiveness of UNDP work. Mobile wallets foster UNDP’s new way of working with its partners and beneficiaries. Mobile payments proved an instrumental pathway for moving ahead towards leaving no one behind, specifically in terms of benefiting from financial and banking services at grassroots level. They also supported the local economic growth through steering the cash injection into a specific targeted geographical area.

The Heart of Amman initiative is being implemented with the technical assistance of UNDP’s Inclusive Growth and Sustainable Livelihoods team, in partnership with local administrations and municipalities, and supports Jordan with a special focus on urbanized areas. Heart of Amman is funded by the Government of Japan and implemented in partnership with the Greater Amman Municipality and the National Microfinance Bank.