Your Excellencies, distinguished guests, ladies and gentlemen, I’m honored to be here today to address the private sector’s role in advancing the UN’s Sustainable Development Goals, and in particular, what Goal 16, building peaceful and inclusive societies, means to Mastercard.
First, I’d like to commend His Excellency, President of the General Assembly Miroslav Lajčák for making the cause of building lasting peace a key priority. And, through his call for partnerships, acknowledging the role the private sector can play in assisting governments and the UN in fulfilling this goal.
While many of you may think of Mastercard as the piece of plastic in your wallet, we are actually a technology network built on virtual trust that allows buyers and sellers in 210 countries and territories to transact in a secure, simple and stable way. We have more than 50 years of experience connecting people and businesses who trust our network to connect them and seamlessly move their money from point A to point B.
It’s this foundation of trust built on technology and expertise that we believe contributes to today’s conversation on sustainable peace.
Just as I wouldn’t expect the panelists to represent all of the perspectives of civil society, I cannot speak for the entirety of the private sector. Rather, I am here today to share Mastercard’s approach to engaging private sector actors to help build peaceful and inclusive societies.
When we think about targets for Goal 16 – reducing trafficking and violence, illicit arms flows, corruption and bribery, and providing legal identity for all – we see our vision of a world beyond cash playing an important role.
The fact is, cash usage has become a major threat in our society. It’s expensive. It’s inefficient. And it facilitates crime and corruption. Terrorism is funded by cash; black money moves across borders in cash; drug wars are fueled by cash; and the wrong public officials are corrupted using cash.
Yet, cash still accounts for more than 80% of the world’s transactions. In the U.S., that number is 50%; in India it’s 90%, and in Brazil and Germany, it’s 80%. The high cost of cash is not just a developing market issue. It’s in developed markets, too. And it’s undermining the peace-building efforts of every person in this room.
We estimate that cash costs developing countries $1.26 trillion per year. That money could be much better used to lift those who are living on less than $1.25 a day out of poverty. And with $2.4 trillion a year needed to achieve the SDGs by 2030, cash is a saboteur that we can’t afford.
Two of the biggest problems of the world – and catalysts for conflict – are inequality and exclusion. And cash fuels both.
The inability of two billion people to safely receive and store money, pay bills without standing in line for hours, save for education, or invest in starting a business, hinders their productivity and limits their potential.
At Mastercard, we believe sustained peace can be achieved by ensuring fair, lasting and shared prosperity for all people, leading to a stronger middle class and more inclusive societies.
In 2010, our CEO Ajay Banga laid out a vision of a world beyond cash and directed the company to commit to eliminating cash through financial inclusion. He believed that doing well as a company goes hand in hand with doing good for society. They are not competing values. So, Mastercard implemented a purpose-driven business strategy to be a force for good in the world while creating opportunities for sustainable, long-term growth by aiming to reach the more than 2 billion people around the world who have been excluded from financial services.
Since that time, we have worked with governments on more than 1500 programs in 60 countries and connected 360 million people around the world to financial accounts. We are over halfway to our goal of reaching half a billion people by 2020.
With the majority of the financially excluded being women, we’ve learned that when you empower women and give us more control over household finances we are more likely to invest it back into our families and communities for the betterment of society. For example, a study in Mexico showed that debit card disbursements to low-income mothers receiving cash transfers resulted in increased savings.
But what good is a debit card if that mom in Mexico has nowhere to use it? That’s why we’ve also committed to connecting 40 million merchants to financial services by 2020.
When you connect these businesses to the formal economy – with affordable ways to accept electronic payments – you catalyze inclusive growth. And, this is where industry players like Mastercard can contribute with solutions that offer low-cost electronic payment options for smaller merchants to join the digital economy. We are also partnering with other purpose driven companies like Unilever to help small merchants grow their businesses and local economies.
We are also tackling exclusion for the 1.5 billion people who don’t have formal identification – a key target for Goal 16. Despite recent progress, more than 1 in 4 children under the age of 5 worldwide don’t have birth certificates. In countries like Egypt and Nigeria, we’re linking digital identity to payments through mobile phones and cards because we know that universal ID not only empowers citizens to claim their rights and the benefits owed to them, but it also generates cost savings for governments and accelerates inclusive growth.
Yes, we are doing all of this because we believe it’s the right thing to do, but it’s also key to our company’s future. Business cannot succeed in a failing world. That is a practical reality. Peace, justice and inclusion are good for business.
Businesses like Mastercard are in an ideal position to be a force for good in the world, by linking our development efforts to opportunities that can foster long-term peace and prosperity.
It’s a missed opportunity when we don’t leverage what the private sector does best – which is bring innovation and scale to the table – to create solutions that reduce conflict and build towards peace. Research shows companies pursuing strategies aligned with the Global Goals could open economic opportunities worth more than $12 trillion and generate up to 380 million jobs globally by 2030.
But we cannot do it alone. Our success – YOUR success – depends on strong and sustained partnerships.
There’s a song often sung around this time of year that goes, “let there be peace on earth and let it begin with me.” There is unlimited need in the world, and the resources to meet them must be maximized. So, achieving peace on earth has to begin with us all, working together. There are too many problems in the world to solve purely by putting philanthropic and government dollars to work. We have to combine those resources with the capital, energy, and intellectual horse power of the private sector.
If we do this, we can make a contribution greater than any single company, government or development agency could do on its own. This will light the pathway from poverty to shared prosperity – and we stand ready to blaze that path with you.