The MasterCard Foundation and UN Capital Development Fund Increase Access to Financial Services for Young People in Sub-Saharan Africa
New York, NY – December 13, 2010 – The MasterCard Foundation and the UN Capital Development Fund (UNCDF) today announced YouthStart, an initiative to increase access to financial services for 200,000 low-income youth in Sub-Saharan Africa. YouthStart was catalyzed by a four year, $12 million contribution from The MasterCard Foundation.
With a specific emphasis on savings, YouthStart is a competition-based program that will identify and support up to 12 financial institutions to pilot and roll out sustainable financial services tailored to youth.
“The MasterCard Foundation is committed to helping youth start out right,” said Reeta Roy, President and CEO of The MasterCard Foundation. “Through YouthStart, The MasterCard Foundation is opening up pathways for 200,000 Sub-Saharan African youth, half of whom will be girls and young women, to gain access to financial services.”
As part of YouthStart, UNCDF will encourage collaboration among financial institutions and providers of non-financial services, disseminating lessons learned to spur innovation and influence policy decisions. YouthStart expands the capacity of UNCDF and microfinance institutions to enable youth to participate in inclusive financial sectors.
“We are excited about the potential for YouthStart to accelerate the establishment of youth financial services in Sub-Saharan Africa,” said David Morrison, UNCDF Executive Secretary. “Our strong expertise in ensuring that more households and small businesses gain access to credit, savings, insurance and other financial services that expand opportunities — combined with the Foundation’s network and resources — presents another boost for reducing poverty and accelerating progress towards the Millennium Development Goals (MDGs).”
Today, more than a quarter of the population of Sub-Saharan Africa are between the ages of 12 to 24, making this group of young people the largest ever to be entering adulthood. Poverty affects this group in a personal and striking manner. Half of Africa’s youth remain illiterate, and youth unemployment rates are two to three times that of adults. Young women in particular face a more a complex and challenging transition to the workplace and independent adulthood than young men, as they are more likely to fail to complete primary education and face increasing insecurity and discrimination in the labor market.
Early findings suggest that financial services aimed at youth can best promote asset-building and sustainable livelihoods when complemented with life, entrepreneurship and financial literacy training. However, less than five percent of youth in the region have access to financial services. Few financial institutions have experience serving youth or working with youth support organizations to design and deliver youth-centric programs.
YouthStart aims to change this situation. Investing in young people and in youth inclusive financial services will provide a long-lasting and effective dividend towards meeting the MDGs, particularly the specific goal of reducing poverty by half by 2015.
Through the provision of technical assistance, market research and advice on how to partner with youth support organizations, YouthStart will help microfinance providers develop effective channels to deliver demand-driven services to youth.
About The MasterCard Foundation
The MasterCard Foundation believes that people have the potential to transform their lives and to improve the lives of their families and their communities. By increasing access to microfinance and youth education to people in developing countries, the Foundation is enabling them to realize their potential and lift themselves out of poverty. It is an independent, private foundation based in Toronto, Canada and was established through the generosity of MasterCard Worldwide at the time of the company’s initial public offering in 2006. For more information, see www.mastercardfdn.org.
About UNCDF
UNCDF is the UN’s capital investment agency for the world’s 49 least developed countries. It creates new opportunities for poor people and their communities by increasing access to microfinance and investment capital. UNCDF focuses on Africa and the poorest countries of Asia, with a special commitment to countries emerging from conflict or crisis. It provides seed capital – grants and loans – and technical support to help microfinance institutions reach more poor households and small businesses, and local governments finance the capital investments – water systems, feeder roads, schools, irrigation schemes – that will improve poor peoples’ lives. UNCDF programmes help to empower women, and are designed to catalyze larger capital flows from the private sector, national governments and development partners, for maximum impact toward the Millennium Development Goals. For more information, see http://www.uncdf.org/.
Contact:
Krista Pawley
Vice President Communications, The MasterCard Foundation
kpawley@mastercardfdn.org
Ms. Maria Perdomo
YouthStart Programme Manager, UNCDF
maria.perdomo@uncdf.org
