Page 8 - Market Commentary

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Does digital money adoption make a difference?
The adoption of digital money can have tangible benefits for government,
business and consumer. Doing nothing simply means allowing the system
to develop dysfunctionally and delaying the tremendous socioeconomic
benefits that adoption can bring.
$100Bn
$600Bn
$200Bn
$700Bn
$300Bn
$800Bn
$400Bn
$900Bn
$500Bn
$1Tn
Reduction in the
informal economy
1
Estimated
increase
in tax
collections
1
*
Based on an average 10% increase in digital money readiness score and commensurate increase in adoption.
1
Based on regression against GNI across 90 countries, which is estimated to be $81Tn (source: World Bank, 2012).
2
Size of deposits and loans estimated using average savings and loan sizes in microfinance; average MF deposit across 90 countries: $620; average MF loan value across 90 countries: $2,500 (source: MixMarket).
3
Based on regression against 15+ population across 90 countries, estimated to be 4.6Bn (source: Global Findex database, World Bank, 2012).
4
Average loan rate for informal sector: 41%; average loan rate for formal sector: 8% (source: World Bank); cost of financing estimated assuming 60% reduction in loan rate on moving to formal FI sector.
5
Interest from savings computed using average savings rate (4.45%, source: World Bank) and assuming that current savings outside formal FI does not attract any interest.
Benefits to Government
*
Benefits to Consumer
*
Benefits to Business
*
$10Bn
$60Bn
$20Bn
$70Bn
$30Bn
$80Bn
$40Bn
$50Bn
Associated increase
in deposits
2
Associated
increase
in loans
2
$100
55 million
$10
$20
$30
$200
110 million
$300
165 million
$400
220 million
$500
$600
Lower annual
cost of financing
per individual
4
Number of individuals
likely to enter the formal
financial sectorl
3
Additional
interest from
savings per
individual
5