Media Contacts New America: Jenny Mellamo 202.596.3368
Save the Children: Ajla Grozdanic 202.251.5859
WASHINGTON, D.C. (May 19, 2014) — Dispelling the myth that poverty is the biggest barrier to saving money, the latest figures from a five-year savings program for youth indicate that 85,000 low-income youth in Nepal, Kenya, Ghana and Colombia, have opened savings accounts designed specifically for them. While we must wait another year for final conclusions, preliminary data indicates that YouthSave is contributing to the goal of financial inclusion for a particularly vulnerable population.
As of February 2013, 40 percent of YouthSave account holders were living on less than $2.50 a day and 13 percent were living on less than $1.25 per day. Considering this, and the fact that the majority of youth participating in this innovative project have no steady income, their saving behavior demonstrates the need to think strategically about poverty alleviation and develop specific products and programs for vulnerable segments of the population.
Project findings to date also suggest that young people have significant unrecognized economic potential. They provide useful guidance for organizations and policymakers seeking to ensure access to positive social and economic pathways for 1.8 billion youth between the ages of 10 and 24 – the world’s largest generation.
Created in partnership with The MasterCard Foundation, YouthSave is led by Save the Children in collaboration with the Center for Social Development at Washington University in St. Louis, the New America Foundation and the Consultative Group to Assist the Poor (CGAP).
According to Rani Deshpande, YouthSave’s Project Director, “well-designed youth savings products are effective tools to encourage asset building, promoting social and economic advancement for youth savers and their families.”
As one youth savings account holder in Nepal put it, “Now when we find even a rupee or two, we save it!” One rupee, shilling, cedi and peso at a time, youth as young as 10 are slowly saving their way to a better future. With the aim of covering education-related expenses, helping with family emergencies and even possibly investing in a future business, YouthSave youth are building assets and habits. The latter, many contend, may be the most important to poverty reduction efforts because it can lead to youth developing a positive mindset about their future prospects.
The YouthSave initiative aims to provide savings knowledge and access to formal savings accounts for low-income youth, through partnerships with local financial institutions. The project has an important research component that documents savings outcomes and investigates their role in improved cognitive, educational and health-related outcomes. The research also explores the business rationale for financial service providers to offer savings products to youth on a commercial basis.
To learn more about YouthSave, visit http://www.youthsave.org, follow us on Twitter @globalassetsna and check out this video about young people in Colombia learning how to save: vimeo.com/94984391.
About Center for Social Development
The Center for Social Development (CSD) is a research and policy center housed at the George Warren Brown School of Social Work at Washington University in St. Louis. CSD has a strong track record of respected applied research that informs policy and practice in the following countries: Australia, Canada, China, (including Mainland, Hong Kong, Taiwan, and Macau), Colombia, Ghana, Hungary, Indonesia, Israel, Kenya, Nepal, Peru, Singapore, Slovakia, South Korea, Uganda, and United Kingdom. For more information visit: http://csd.wustl.edu
About CGAP (Consultive Group to Assist the Poor)
CGAP is an independent policy and research center dedicated to advancing financial access for the world's poor. It is supported by over 30 development agencies and private foundations who share a common mission to reduce poverty. Housed at the World Bank, CGAP provides market intelligence, promotes standards, develops innovative solutions and offers advisory services to governments, microfinance providers, donors and investors. For more information visit: http://www.cgap.org
About The MasterCard Foundation
The MasterCard Foundation is an independent, global organization based in Toronto, Canada, with more than $9 billion in assets. Through collaboration with partner organizations in 46 countries, it is creating opportunities for all people to learn and prosper. The Foundation's programs promote financial inclusion and advance youth learning, mostly in Africa. Established in 2006 through the generosity of MasterCard Worldwide when it became a public company, the Foundation is a separate and independent entity. The policies, operations and funding decisions of the Foundation are determined by its own Board of Directors and President and CEO. For more information on the Foundation, please visit www.mastercardfdn.org
About New America
New America is a nonprofit, nonpartisan public policy institute that invests in new thinkers and new ideas to address the next generation of challenges facing the United States. To learn more, please visit us online at www.newamerica.org or follow us on Twitter @NewAmerica.
Save the Children gives children in the United States and around the world a healthy start, the opportunity to learn and protect from harm. We invest in childhood-- every day, in times of crisis and for our future. Follow us on Twitter and Facebook.