Why the Fund
Why does Mastercard Foundation For Rural Prosperity exist?
Sub-Saharan Africa is growing rapidly, but the pattern of growth has increased inequality, and growth has not led to substantial poverty reduction. Many rural areas in Africa remain extremely poor, with the smallholder farmers that make up 65% of Africa's workforce largely excluded from the economic growth story.
This poverty is reinforced by financial exclusion.
Rural poor people need financial services that allow them to alter their livelihood strategies, to develop better ways of managing wealth, earn an income and reduce the vulnerability of falling into poverty traps. They need products that are designed to address specific financial needs arising out of their livelihoods and demands upon their household finances.
For financial inclusion to truly have a transformative impact, rural poor people also need a better understanding of how they can put these financial products to effective use for their own benefit.
Over the past 15 years, challenge funds have become an established mechanism through which to encourage the private sector to deliver social outcomes (to shift commercial goals closer to social objectives). The Mastercard Foundation Fund for Rural Prosperity hopes to work with the private sector in Africa to reach at least 1,000,000 financially excluded people on the continent.
The Mastercard Foundation Fund for Rural Prosperity will support innovative ideas that have the potential to grow to scale and also have a deep social impact on the lives of rural poor people throughout Sub-Saharan Africa. The Fund offers two competitions or challenges:
- Innovation Competition: US$15 million will support the development of ideas for new products, services or processes that increase access to finance for rural poor people; and
- Scaling Competition: US$35 million will help to scale the most promising ideas or pilots that have the potential to drive financial inclusion for large numbers of smallholder farmers and rural poor people in new geographic areas.