Mohammed Qadadeh is Head of Government Services and Solutions (GS&S) for Middle East and North Africa at MasterCard. He is responsible for MasterCard’s government business, overseeing its expansion strategies and leveraging MasterCard’s capabilities to solve government’s needs for efficiency, social progress & financial inclusion as well as transparency. Kyivstar sat down to talk with him at the International E-Governance Symposium.
What can MasterCard do to help governments in achieving e-governance goals?
Qadadeh: At MasterCard we have a model. As private companies do well in the world they must do good. As a company in the payment technology area we look to bring access to financial instruments to millions and billions of people on this earth.
How do you do that in an emerging market? Especially when there isn’t a lot of trust and it is a cash based economy.
Qadadeh: Listen, in Africa and the Middle East 85-90% or transactions are still in cash. People are used to the old way of doing things, but it is very inefficient and non-transparent for the government, and people don’t benefit as much from cash.
When you have governments switching to electronic means of dispersing payrolls and pensions you find that corruption decreases, transparency increases and governments experience millions in savings. Initially it is hard. We have introduced cards for the South African social security program, giving out 12 million cards in 18 months. Initially, people go to the ATM and take out all of the cash. Overtime though people start to see that if I leave some money in the account it will stay there. It starts to build trust and that opens access to other services and they start to benefit from that.
Each country has a different model of financial inclusion. In South Africa it is card based. It is the national ID in Nigeria, where the National ID is a double faced card. In Egypt it is the mobile.
And what does citizen authentication enable?
Qadadeh: To give people financial access there are several steps along the way. The original one is digital identity or just an identity, knowing who this person is. It has a lot to do with efficiency and corruption. In the past governments have paid out money to dead people and they don’t have a way to verify they are alive. Through digital identity they can identify that. Identity is at the heart of the matter, but also a starting point. Then you have to have government agencies using these systems and then you have to give the people themselves a way to use it. It can’t just be ATMS, it has to be supermarkets, cashback, remittance capabilities. There has to be value added services so they will start to adopt them and trust them.
What can move these sorts of programs forward?
Qadadeh: As long as there is resolve on the government’s part to reduce corruption and empower the people. And as long as there is continuous momentum even as the people in office change over time you will see these programs come to fruition.
It is beautiful. It makes the economy work. It gives the government the efficiency and transparency they want. And it gives the people the power to transact wherever they want and to safely and securely receive their money.
What differentiates developed from developing countries in e-services?
Qadadeh: Qatar has the highest GDP per capita in the world and Pakistan has one of the lowest. So I have a huge variety of clients. In Dubai government is about innovation, mobile services, and making people happy. If people aren’t happy then the government should go. And if the services are not up to par they should change. Sheikh Mohammed commissioned every government agency to provide their services via mobile phone and now they all do. Now the next stage of the strategy is to increase adoption and increase it to 70 or 80 percent. There the resolve is clear.
You talk about other areas, large countries like Pakistan, Egypt, or Morocco. There you have a history of large government subsidies. Some are at source like petrol subsidies. Those apply to everyone so they are looking for ways to target them to the needy. In Pakistan they have subsidies to make sure you go to school. The set of problems is completely different. Automating around a national identity with a card or mobile program makes sense because you have many ministries developing their own programs to achieve the same goal instead of having one platform.
What about privacy concerns?
Qadadeh: We take privacy very seriously. But contrary to popular belief when someone uses their MasterCard we don’t know who they are. All we know is a card number, an amount, and a merchant. We know this card was used at this coffee shop to buy coffee for $10. Even then in Egypt there are still concerns. So there where we developed the e-wallet we put all the information on Egypt’s soil under the control of locally relevant companies. There we don’t see any consumer data like names or addresses.
What excites you?
Qadadeh: For me Egypt takes the cake. It is MasterCards first mobile ecosystem. Most of the time companies try and go it alone. But in Egypt we worked with local partners and gave the Central Bank control over the data. That provides a more secure environment than cash. Now, they don’t know about it concerning corruption or terrorism and the Central Bank or the security services don’t know about it. In the future they have much more control over security because they can tell that this money went from this person to this person. In the cash world it is untraceable. As an Arab fighting corruption it is an important issue.