PRESS RELEASE: Développement International Desjardins (DID) and Gates Foundation Agree to Develop Financial Cooperative Interconnectivity in West Africa, Haiti and Vietnam

Source: Développement International Desjardins (DID)

Original press release available here.

LÉVIS, CANADA, January 9 – Over the next three years Développement International Desjardins (DID), a component of the Desjardins Group, will carry out a major project aimed at increasing interconnectivity among nearly 250 financial cooperatives within developing countries. The project, funded through a USD 9.1 million grant from the Bill & Melinda Gates Foundation, will span three continents and will initially allow 830,000 people to gain access to interconnected services, such as banking and electronic fund transfers among the financial cooperatives, with the goal of ultimately expanding into the extended DID network of partners.

For many poor people and especially those living in rural areas of the developing world, financial cooperatives are the most common way to access financial services. In many of these areas, services are limited and the cooperatives are not connected or able to offer clients the chance to access funds, insure their deposits, or use an ATM network outside of their own cooperative. Improved interconnected services are likely to help address these challenges, making enhanced financial services available to more people.

DID’s project will develop, test, and launch a new software platform that will connect five networks of savings and credit cooperatives and allow members to transact within the network and transfer funds between cooperatives.

The networks are in West Africa (Burkina Faso, Mali, Togo), Haiti and Vietnam, and are longstanding DID partners. These networks took their inspiration from Desjardins – some of them 35 years ago – to establish financial cooperatives, create financial products adapted to local needs and, more recently, set up federations and develop their service offer. A pilot project already in progress in Haiti, which is implementing telecommunications infrastructure so that financial cooperatives can offer new services to customers, has demonstrated encouraging results.

DID’s extended network of partners currently reaches more than three million families, or approximately 15 million individuals. Through the operations of savings and credit cooperatives in their respective countries, they contribute significantly to increasing access to basic financial services for the poor. The interconnectivity project will provide support for this local commitment and potentially multiply the outreach of services offered tenfold.

A cooperative, innovative project unlike any other in the microfinance industry today
This project responds to needs clearly outlined by the members of these networks of financial institutions, one of which is to ensure security for the financial transactions they make while traveling within their respective countries. “For these financial institutions and their members, the ability to transact business safely and securely is just as important as gaining access to credit. We are convinced that this interconnectivity project will, by meeting basic needs, help improve access to financial services and reduce poverty in these communities in addition to serving as a model for microfinance networks elsewhere throughout the world,” stated DID President and CEO Anne Gaboury.

Networks of savings and credit cooperatives in developing countries often have wide geographic outreach and are the only financial institutions operating in rural areas. Interconnectivity between rural and urban financial cooperatives, in one network, is a way to harmonize operations and services among them and improve the efficiency and quality of the services provided to their members. The increasing availability of GSM data services, even in rural areas, as well as falling prices for network hardware and software, data storage and handheld devices, means that it is possible to imagine connecting even small and remote institutions.

Part of the funds will be used to round out the IT infrastructure of the financial institutions participating in the interconnectivity project (a prerequisite), develop local skills and promote the new services to the members.

Valued Partnership between Desjardins and the Bill & Melinda Gates Foundation

Desjardins’ experience in the field of improving access to financial services, as well as its established relationships with microfinance networks in developing countries, are core strengths of this project and will contribute to ensuring its success. These were the key factors recognized by the foundation’s Financial Services for the Poor initiative, which is working with partners to develop and employ innovative ways to bring a wide range of financial services to people living in poverty throughout the developing world.

“The Bill & Melinda Gates Foundation is pleased to partner with Développement international Desjardins in this effort to bring small, unitary institutions into the greater financial system, affording clients better products and services, and allowing cooperatives to increase their outreach,” said Bob Christen, director of the foundation’s Financial Services for the Poor initiative. “This will be a difficult task, but we believe DID is well-positioned to strengthen the cooperative movement in low-access countries and we hope to learn more about how interconnectivity can help people with great needs and few resources.”

The President and Chief Executive Officer of the Desjardins Group, Alban D’Amours, was delighted by the confidence shown in Développement international Desjardins by the foundation. “The implementation of this project and its scope bear witness to the outreach achieved by DID and the recognition accorded its expertise. The entire network of Desjardins cooperatives can be proud. This project will make it possible to develop intercooperation even further. Intercooperation is one of the basic principles for development of the cooperative movement and its ability to meet the needs of communities effectively.”

Long-term outlook

Throughout the project, DID will evaluate and assess the impact of interconnectivity and the lessons learned. The project results will also be communicated to other DID partners in order to multiply the potential for interconnectivity and provide benefits to numerous other countries where development of microfinance is a priority. DID currently has partners in over twenty countries located on four different continents.

About DID

Développement international Desjardins (DID) is a component of the Desjardins Group, the largest integrated cooperative financial group in Canada. For over 35 years, DID has been providing support for the creation, development and strengthening of financial institutions and is now present in twenty countries in Africa, Latin America, the Caribbean and Central and Eastern Europe. DID, which specializes in providing technical support and investment for community finance, draws on the rich and diverse experience acquired through collaboration with numerous partners, and on the 100 years of experience of the Desjardins Group. DID works in partnership with the Canadian International Development Agency, the World Bank and other multilateral organizations.

About the Bill & Melinda Gates Foundation

Guided by the belief that every life has equal value, the Bill & Melinda Gates Foundation works to help all people lead healthy, productive lives. In developing countries, it focuses on improving people’s health and giving them the chance to lift themselves out of hunger and extreme poverty. Based in Seattle, the foundation is led by CEO Patty Stonesifer and co-chair William H. Gates Sr., under the direction of Bill and Melinda Gates and Warren Buffett.

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