Micro Pension Visa Financial Inclusion Lab
CORPORATE
Visa partners with Micro Pension to channelize micro-savings and pensions for low income households across India
literacy &
counselling centres
Strengthening its commitment to becoming
a partner and enabler to promote the nation's financial inclusion agenda, Visa
today announced a partnership with Micro Pension's Foundation, an Indian non-profit
organization. The partnership will establish a Micro Pension's Visa
Financial Inclusion Lab as an incubator of innovative payment solutions,
targeting 140 million low income, unbanked, informal sector individuals,
providing them with access to affordable, micro-savings and pension products
from regulated financial institutions.
Uttam Nayak, Group Country Manager - India
and South Asia, Visa,
said with a current elderly population of over 100 million that is set to nearly
double within the next decade, it is imperative for India to establish an
inclusive institutional architecture and encourage the workforce to set aside a
part of their present incomes for their old age and other social security needs.
We are delighted to partner with Micro Pension's Foundation and through the Lab we
propose to create solutions that inculcate and channelize savings. The pilot
truckers programme is one such example. The truck drivers and cleaners due to
their nature of employment have intermittent incomes, and a concerted effort to
educate them on the benefits of saving regularly for old age has been undertaken
through the Lab's financial literacy centre set up at Sanjay Gandhi Transport
Nagar in Delhi. On a daily basis, 20 drivers get educated on the programme and
we look forward to tracking the progress of enrolments.
Gautam Bhardwaj, Managing Director of
IIMPS and co-founder of the non-profit Micro Pension's Foundation, said the policy
and regulatory efforts with long-term micro-savings gather further momentum and
begin succeeding at scale, millions of everyday Indians will need a secure and
convenient mechanism to channel potentially tiny pension contributions, month
after month over multiple decades, to regulated fund managers. This will
directly impact both voluntary savings discipline and the amount of pension that
subscribers get in their old age. Secure and well regulated technology-based,
cashless payment solutions will therefore be a key ingredient for India's
success with its pension reform programme. This joint research and development
initiative with Visa will actively focus on this area.
Stephen Kehoe, Head of Global Financial
Inclusion, Visa said, everyone has the right to have access to safe and secure financial services - and
the technology exists today to make this a reality. We are excited about the
potential that this partnership offers in terms of providing micro pension
products in India and believe it could serve as a model for other countries. It
is a great example of how we can use Visa's payments network and our partnerships
to support a visionary pension program that the Indian government has
initiated. It also illustrates how the private sector can work collaboratively
with the public sector to promote an important government initiative, which will
support broader financial inclusion goals.
The Lab has developed and launched a range
of initiatives to foster financial inclusion:
Micro-payments for migrant workers:
The Lab first rolled out
a simple, secure, portable and affordable magnetic stripe card based
micro-payment solution that enables the unbanked poor to directly transmit
periodic long-term micro-savings to regulated pension and insurance product
providers. Thousands of migrant workers in both urban and very remote rural
locations, including home-based women workers, street venders, marginal farmers,
head-loaders and small retailers are already using this mechanism to save
roughly Rs.200 a month for their old age at a negligible transaction
cost.
Benefits for the financially excluded:
In a significant step
forward, the secure micro-payment solution, along with a set of unique financial
literacy tools developed by Visa, are being used to inform, educate and
encourage very poor, highly marginalized and extremely remote tribal communities
in the Nilgiri mountains of India to voluntarily join a contributions-based
pension and long-term micro-savings programmes. Two fully equipped retirement
literacy centres were also set up with the Centre for Tribal Research and
Development (CRTD) in the region. A convenient and simple micro-payment solution
has resulted in a savings rate of over 85% among a population that, till barely
a decade ago, did not fully comprehend or use money and relied on bartering to
meet their day-to-day needs.
Financial and retirement literacy
centres: Encouraged by
the impact of its financial literacy and micro-payment solutions, the Lab is in
the process of establishing 100 retirement literacy centres in remote locations
of India in collaboration with local outreach partners such as cooperatives,
rural banks and NGOs such as SEWA Bank to provide on-going education and
information to micro-saving beneficiaries.
Micro-Pension for domestic
help: Over 25 million poor in India are employed
as domestic help (drivers, maids, cooks, gardeners, guards) in middle and
upper-middle income households in India's metros and tier-1 cities. The Lab is
developing an innovative e-commerce model to encourage and enable such
households to educate and enrol their domestic help for an integrated social
security program. Through their employers, domestic workers can have their
micro-savings transferred into individual Micro-Pension's accounts online via a
Visa-enabled payment gateway. In the long-term, these workers will use their own
Visa-Micro Pension's repaid cards to accelerate micro-savings into their social
security accounts.
About Visa:
Visa is a global payments technology
company that connects consumers, businesses, financial institutions, and
governments in more than 200 countries and territories to fast, secure and
reliable electronic payments. We operate one of the world's most advanced
processing networks Aisa Net that is capable of handling more than 30,000
transaction messages a second, with fraud protection for consumers and assured
payment for merchants. Visa is not a bank and does not issue cards, extend
credit or set rates and fees for consumers. Visa's innovations, however, enable
its financial institution customers to offer consumers more choices: pay now
with debit, ahead of time with prepaid or later with credit products. For more
information, visit corporate.visa.com.
About Micro Pension's Foundation:
The Micro Pension's Foundation (MPF) is a
new, non-profit affiliate of Invest India Micro Pension's services (IIMPS). MPF
does research and development towards building integrated and replicable
solutions. MPF brings together all key ingredients including products, outreach
platforms, communication strategies and micro-payment mechanisms, to foster
access and utilization of finance at scale by low income excluded households.
MPF closely works with IIMPS in field-testing integrated, scalable and
sustainable ecosystem prototype for micro-savings programs with multiple
financial products targeting the unbanked poor.
About Invest India Micro
Pension's Services
(IIMPS):
IIMPS is the only social enterprise in the
world focussed exclusively on educating, encouraging and assisting women in low
income households and economically active poor more generally to accumulate
micro-savings for regulated pension, insurance and savings products. At the
present time, IIMPS is assisting roughly 600,000 low income workers, nearly 75%
of who are women, across 14 States to save for their retirement. IIMPS
shareholders include KfW, SEWA, UTI AMC and the Michael & Susan Dell
Foundation and works actively with a range of key institutional partners
including NABARD, UNDP, LIC, Janalakshmi, Ujjivan and MicroSave. For more
information, visit http://www.micropensions.com
Comments
Post a Comment