Earlier this month I had the opportunity to visit Colombia for the first time. I had been asked to deliver a keynote at TransUnion Latin America’s inaugural Financial Services Summit in the city of Cartagena, talking about Financial Inclusion in Post-Conflict Africa.
I’ve written before about the striking number of similarities South Africa and Colombia share. They have comparable population sizes and uneven distributions of wealth - both countries rank near the top of the Gini Index, which measures inequality. Both have a large population of unbanked, as well as a hefty informal sector that relies on cash. And both are at very similar stages of their development - emerging from long periods of conflict with vast potential for growth.
As someone from a continent that’s more often defined by its challenges and shortcomings rather than the progress it’s made fixing them, there was a real sense of brother- and sisterhood at the summit. Despite the language barriers, there was a shared understanding - that we would not be defined by our difficult past but use it as a platform for growth.
The sense of familiarity and kinship only increased as I listened to people like Jorge Castaño Gutierrez, Head of the Financial Superintendence of Colombia, discuss the barriers to financial inclusion in his country. From alternative data to innovative consumer-first design to simplicity and accessibility, the themes from his talk were universal to all emerging nations.
Getting past the legacy of Escobar
You can’t talk about Colombian innovation without mentioning Medellin, which has emerged from its well-known history to become a shining example of inclusive city design. Once known as most dangerous city in the world, it’s now one of Latin America’s foremost tech hubs thanks to progressive and proactive leadership that embraced digital initiatives.
Medellin is the Colombian city with highest readership, thanks to the construction of library parks and various STEM and digital training initiatives. It has its own crowdsourcing platform called MiMedellín, which allows its Paisas (as residents of the region are called) to share potential solutions to address the city’s problems. Now, having built the digital and data infrastructure, it is using it to drive entrepreneurship through projects like the Route N Innovation District.
In a way, Medellin is a powerful symbol of not just Colombia’s transformation, but the inherent potential of post-conflict societies as a whole. Escobar exploited the inequality of the city, positioning himself as a champion of the poor. This proved to be the burning platform that drove the leadership of Medellin to embrace inclusive policies and design as a way of empowering the marginalised people of the city. Transforming Medellin into a place of hope and opportunity could simply not have been possible without giving the people a voice in its development.
Putting citizens first
Medellin is not Colombia’s only success story. The government has shown an incredible commitment towards creating a foundation on which entrepreneurship and digital empowerment can thrive. Through promoter policies, digital tools and e-governance programmes, citizens have been able to play an active role in their own growth.
Government payments, from salaries to supplier payments to social welfare, are almost entirely digital nowadays. Many people are accessing bank accounts for the first time because of these cashless social welfare programmes.
Even those who lack access to the internet have a platform to access digital services through a service called My Line, a kind of analogue Siri. If any of the almost 50% of Colombians who don’t own a smartphone need specific information, they can call a traditional telephone landline powered by Google Voice Assistant and get their question answered.
Meanwhile, the microfinance sector is stepping to meet the needs of the large informal economy through a mix of data-driven technology and flexible product offerings designed for financially vulnerable customers. Colombia’s microlending industry is one of the largest in Latin America thanks to policies that make it easier for SMEs to secure funding without jumping through needless hoops.
These actions have had a big impact in driving financial inclusion in the country. 2017 saw 1.1 million Colombians joined the formal financial system for the first time. TransUnion’s own focus on alternative data and empowerment has seen the enablement of 5.9 million people.
As South Africa embarks continues on its own path towards e-governance and digital inclusion, stories like Colombia’s are powerful case studies for positive change.
United by our similarities, inspired by our differences
These positive stories were fresh in my mind when I got up to present my own examples of digital leapfrogging – Kenya’s M-Pesa, FNB, Capitec and many more - at the summit. There was a wonderful sense of enthusiasm from the audience for seeing different approaches to fundamentally similar problems. I am confident that they walked away with as much value from seeing their own challenges reflected through an African lens as I gained from the Colombian perspective.
Simplicity, customer-centricity, inclusivity and free exchange of information - these were the common threads that linked all of our talks. While emerging nations’ challenges are all unique, the basic building blocks for leapfrogging are similar the world over. Colombia and South Africa are still in the early years of their paths towards inclusive growth, but there are as many, if not more, insights to be gained from closer collaboration with each other than from nations at the peak of their development.
I left Colombia with the same feeling as I did when departing Kenya, Rwanda and India - with a renewed sense of purpose and a drive to put into practice what I’d learned from my peers. After all, being behind is what’s gotten us ahead.