PCC enables firms in the same sector come together to work towards a common good or to create public goods to help to reduce the cost that individual firms have to bear to achieve that goal.
Discussing how banks could make a business case for Youth Savings Accounts at a Stakeholder Forum on Child and Youth Savings by the YouSave Project In Ghana, Ms Rani Deshpande, Director of the Livelihoods Department of the YouthSave Project, noted that the business case for YSAs is not a ‘slam dunk’ in the short-term but rather a long term investment.
A PCC arrangement would be a useful tool in shifting the economics of the investment and reduce the upfront cost as it spreads the costs among a number of institutions and could also expand the market to a scale where there is room for everyone.
Citing an example of the World Wide Web Consortium, which brought together hundreds of companies to develop protocol and guidelines to ensure the long-term health and development of the World Wide Web; a task which could not be undertaken by any single company, she highlighted the PCC’s ability to bring together the fiercest competitors to collaborate for the common good.
“If Apple and Microsoft can collaborate on something, I am pretty sure the Banks in Ghana can do it,” she stated.
Ms Deshpande said getting financial education to both in and out-of- school youth, is an important area where a PCC would be most promising, especially as the foundation has already been laid with the development of a financial education curriculum through the efforts of government and public donors.
“When you have an asset; it’s the delivery of that asset to the population that now needs to be done and banks could be a natural mechanism for doing that. It’s a very concrete operational task and the private sector excels at doing that kind of delivery,” she noted.
She said NGOs have a critical part to play in the delivering to the marginalised.
She said there is also a concrete interest for financial institutions to fund the delivery of the curriculum as it could expand the market for financial services as evidenced in findings from some of YouthSave’s financial education programmes.
The education programmes showed that from 15 to 42 per cent of young people who participated said they opened a bank account after the event.
In order for such an initiative to work, it would have to be well structured in terms of contributions and benefits.
Some participants at the forum suggested a sliding-scale contribution system, taking into account the size of a firm.
Ms Deshpande said such an arrangement would allow all relevant firms to be part of the Consortium regardless of their financial strength.
Other lessons from globally successful consortia were: keeping entry dues relatively low so that it does not become a barrier to some firms, defining what each firm could contribute for the good of the whole.
It also include having a neutral third party such an NGO or government agency to coordinate the activities of the consortia so that a firm does not have an unfair advantage and also to build trust between the companies since PCC is not in the natural DNA of competing organisations.
Mr Ismail Adam, Deputy Chief Manager of Banking Supervision at the Bank of Ghana (BoG), who chaired the forum, also expressed the need for financial education to go beyond just banking services to include insurance and investment services.
He expressed satisfaction at the eagerness of the banks represented to collaborate and share ideas on some issues which they could not address individually, adding that the BoG, as the regulator, would continue to lay out the required infrastructure to facilitate work in the industry.
Ms Merene Botsio, Manager Strategic Partnerships and Corporate Social Responsibility at Fidelity Bank Ghana Limited said the bank believes in collaboration, having led on financial inclusion in Ghana and pioneering agency banking.
She said Fidelity has collaborated with institutions like MTN and Airtel and is willing to partner with other banks to ensure that citizens, especially the youth, are reached with financial education and services.
She said although perceived competitiveness among banks could be a challenge, about 60 to 65 per cent of Ghana’s population is unbanked and needed to be reached hence the need to collaborate.
“One bank cannot do that so obviously we have to collaborate to make that happen,” she said.
By Belinda Ayamga, GNA