Visa, World Bank Boost Digital Payments in Emerging Markets
Visa and the International Finance Corporation (IFC), a member of the World Bank Group, have launched a risk-sharing initiative to expand digital payments and financial inclusion in emerging markets. The partnership aims to increase access to digital financial services for underbanked consumers and small businesses.
Under the agreement, IFC will share credit settlement risk for Visa transactions with enrolled financial institutions. This arrangement allows these institutions to connect more underbanked individuals and small businesses to digital payment systems. The initiative is set to support approximately $200 million in risk sharing over five years, initially targeting 14 countries in Latin America and the Caribbean. It will involve roughly 50 financial institutions with below-investment grade ratings.
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The collaboration seeks to empower financial institutions to help millions of people and small businesses save, spend, borrow, and grow, enabling fuller participation in the formal economy. Paul Fabara, Visa’s Chief Risk and Client Services Officer, remarked, “Access to digital payments can help unlock economic opportunity.” He continued, “Through this first-of-its-kind partnership with IFC, Visa will help financial institutions bring secure and reliable payment solutions to more people and small businesses in emerging markets.”
Mohamed Gouled, IFC’s Vice President of Products & Clients, highlighted the initiative’s significance: “This initiative exemplifies the power of innovation and partnership to expand economic opportunity where it is needed most.” He added, “By reducing constraints that limit the participation of financial institutions, we are enabling greater access to digital payment solutions for small businesses and entrepreneurs across emerging markets.”
