Mobile payments bid aids poverty fight
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E-mail China Daily, November 26, 2015
A way to alleviating poverty in China is being paved by a multinational development institution.
International Finance Corp is helping the rural population to access mobile payment platforms to support the nation's service-oriented economic restructuring.
IFC is a member of the World Bank Group that focuses exclusively on the private sector in developing countries.
Simon Andrews, IFC country manager for China, Korea and Mongolia, said it will continue to place emphasis on part of its long-term strategies in China by helping people who live in poverty.
In an ongoing program in China, IFC is working with microfinance companies to help them increase lending and services to the poorest areas of the country. This includes small businesses and individuals, Andrews said.
IFC is also interested in expanding financial services to the poor in China through new technology, such as payment systems on smartphones－launching a mobile banking program two years ago to improve financial inclusion in China.
To date, the program has led to more than 3 million accounts being linked to the mobile banking system, to about 590 billion yuan ($92 billion) in non-cash electronic transactions and to 760 million yuan being saved in direct transaction costs.
Big data companies are able to use their platforms to provide smartphone users with access to financial services at much lower cost, Andrews said.
"This is a huge change in providing financial services for individuals, and we think China is a very interesting place to do this," he said.
"In coming years, one of the most important parts of our strategies in China is to support people in less developed areas, to create jobs for them, provide them with access to health, education and financial services－so they can start their own businesses."
This year marks the 30th anniversary of IFC's first investment project in China－an automobile producer in Guangdong province.
The corporation said in a statement that by the end of June it had invested $10.43 billion during the past 30 years in China. This includes $4.67 billion in loans, $3.1 billion in equity investment and $2.08 billion in syndicated loans.
Its investment in the country is widespread, covering financial services, the manufacturing sector, energy and infrastructure construction.
"We are glad to see a positive trend in the long-term transformation of Chinese economic growth from an export-led capital-intensive model to more consumption-oriented growth," Andrews said.
Supporting poverty alleviation will help the poor contribute to economic growth and make for more sustainable development, he added.
Continual support for private Chinese companies to develop overseas forms another part of the corporation's strategies, according to Andrews.
IFC chief executive officer Jin-Yong Cai wrote in its 2015 annual report, "Much more can be done to tackle the challenges of development, especially in mobilizing the financing that will be needed to achieve the sustainable development goals (raised by the United Nations Development Program)."
In the 2015 financial year, IFC long-term investments in developing countries totaled $17.7 billion, a 17 percent increase year-on-year.
Win the battle, Xi urges
President Xi Jinping has called for efforts to "win the battle against poverty", reiterating the importance of this to maintaining social stability and spurring economic growth.
Efforts to eliminate poverty have entered a "last-minute dash," according to a statement issued after a meeting on Monday of the Political Bureau of the Central Committee of the Communist Party of China.
The meeting was chaired by Xi.
The 13th Five-Year Plan (2016-20), a blueprint for the nation's economic development in the next five years, highlights poverty elimination as one of the key tasks the government must fulfill to achieve the target of attaining "moderate prosperity".
At the end of last year, 70.17 million people in rural areas of China were living below the poverty line of 2,300 yuan ($376) in annual income.
The country's top leaders reached a consensus in 2013 to eliminate poverty "precisely", especially in rural areas.
This calls for a targeted and effective approach to be taken toward poverty relief without waiting for any support measures, including subsidies.
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