IFC’s $700 Million Push Could Bring Digital Payments to Millions

Cash remains central to daily life in many emerging economies, partly because millions of consumers and merchants lack access to practical digital alternatives.

The International Finance Corporation (IFC) has launched a risk-sharing initiative designed to help banks, fintech companies and other financial institutions expand digital payment services across emerging markets. The programme will initially provide guarantees worth up to $700 million, covering part of the credit settlement risk that participating institutions face when they connect customers and merchants to global payment ecosystems.

Financial requirements linked to payment networks can place digital services beyond the reach of smaller or less-established financial providers, even when they have strong local knowledge and a growing customer base. IFC's guarantees could give these institutions more room to issue payment cards, serve local merchants and introduce dependable digital tools without carrying the full financial exposure alone.

A digital transaction can open new doors for small businesses

Cash remains central to daily life in many emerging economies, partly because millions of consumers and merchants lack access to practical digital alternatives. This dependence can make transactions less secure, restrict online commerce and leave small businesses without the financial records that may help them demonstrate revenue, build a credit history or qualify for future financing.

Digital payment acceptance can give a neighbourhood shop, market trader or woman-owned enterprise access to customers who prefer cards or other electronic options. The resulting transaction history may provide a clearer picture of business activity, while faster and safer payments can support sales growth and make it easier for entrepreneurs to participate in the formal economy.

"When a small business owner or woman entrepreneur accepts a card payment, it opens the door to more customers, more revenue, and a foothold in the digital economy," IFC Managing Director Makhtar Diop said. He described wider digital payment access as a powerful way to support job creation and connect more people with formal economic opportunities.

IFC expects $280 billion in additional digital payments

IFC estimates that participating financial institutions will generate about $280 billion in additional digital payments, issue 360 million more cards and add 90 million active users. An estimated 39 million of those new users are expected to be women, a group that has often faced greater barriers to formal banking and business finance.

Broader participation could also increase competition among payment providers, encouraging better service, wider coverage and more accessible products. Consumers may gain safer and more convenient ways to pay, while merchants could reach larger markets and manage their income more efficiently. Financial institutions would have an opportunity to develop new services for communities that traditional banking models have struggled to reach.

The initiative places risk-sharing at the centre of financial inclusion by addressing one of the practical constraints preventing banks and fintechs from expanding their payment networks. If the expected growth is achieved, millions of people and small businesses could gain an entry point into the digital economy, turning everyday transactions into opportunities for stronger businesses, new jobs and greater financial independence.