As the cleavage between developed and developing countries is growing, the necessity for International Development is as well. The emergence of digital technologies is prevalent, however, gaps still exist in many parts of the world. Technological and economic barriers must be considered as we proceed in this decade of digital development. Lately, forms of cash and payments have taken the digital form, proving the pertinence of advancing technology in all aspects and in all countries. Digital “economics” are being encouraged in International Development.
Digitalized money – especially direct digital cash transfers – promotes questions about its effectiveness in alleviating poverty. One experiment conducted by the nonprofit Give-Directly investigates how economic policy interventions affect the economies of developing countries. Especially after COVID-19, many families in Kenya found that they lost their sources of income. Direct cash transfers, though posing ethical questions regarding experimentation methods, give impoverished civilians the ability to make financial decisions and change their lifestyle. The mere existence of “digital money” allows for better decision making. Digitalized money can be used for agriculture cultivation – such as medicine for animals, irrigation, and construction – and also on education, basic services, and to jumpstart businesses. There are no incurred fees and insured security, making digital money a dependable source of payment.
Recently, “mobile money,” otherwise known as “pay-as-you-go (PAYGO),” has been aiding families in underdeveloped countries in receiving broadband and solar services. This is a specific system of payment, making for easier accessibility of services for households that demand products with little to no upfront cost . Low-income families in Africa, for example, were able to acquire healthier methods of cooking, excluding firewood and kerosene from their routines. PAYGO allows them to play in installments, making technologically advancing an easier task for customers. In all, the successes of these novel payment methods increased the demand for products from all over the world. Additionally, digitalized payments interconnect developing countries with developed ones through the Internet.
Likewise, these payment methods also allow for an adequate establishment of credit histories. By paying for items that were previously considered too “small” for financing, customers are building their lines of credit for future purchases, which can potentially be more substantial in value. Although this technology is primarily available for households, if applied to the agricultural sector, payments can finance equipment necessary for farmers at an affordable price. Apart from this, digitalized finance shows to improve income earning potential and inclusivity – allowing for better access to banking systems. Moreover, woman’s participation in the finance sector has skyrocketed since the installation of digitalized economics – women being considered an underserved group by digital payment systems. This exemplifies the various aspects of society that digital financing is helping, from equity to democracy.
The improvement of digitalized economics and payments has been unprecedented. Developed countries, such as the United States, presume the role of helping countries. With their technological status, developed countries play a crucial role in advancing the world. Relations between countries are improving, and agriculture innovation is ameliorating as well. International policies are reflecting this progress, as, without cooperation, there would be conflict and global rupture with spillovers. Therefore, in this digital era, if effort from countries is absent, there will be monopolies and regulations that will clash, causing risks and repercussions to developing countries’ citizens and economies. Technology should be carefully implemented.
Some International Development organizations use “farmer-to-farmer” programs to promote volunteer technical assistance to farmers in underdeveloped countries. These programs can ultimately assume the role of improving access to financial services through targeting the agricultural sector. The “Farmer-to-Farmer” program strengthens international ties between countries, creating friendly relations and building developing economies. By utilizing digitalization, “Farmer-to-Farmer” programs are transforming agriculture. Moreover, by targeting agricultural advancement, these programs are promoting economic growth because countries are finding access to global markets through innovation. Assistance of U.S. organizations develops local capacity that is vital for incomes and production. These programs not only enhance agriculture, but also lead to more economic freedom, contributing to a digitalized finance system in that they create more opportunities for management and economic decisions.
Focusing on international cooperation and improving livelihoods through digitalized money will lead to a more sustainable world. There are many instances when mobile banking stimulates enviornmentally-sustainable living. Applications may notify their users about the impact of their purchases – whether it is energy-related, produce, or even equipment based. Mobile banking opened the practices of feasible priorities in banking systems in which both banks and households are able to focus on helping the environment, while also achieving personal and international goals.
In all, the revolution of digitized money and banking systems is very relevant today. Families in underdeveloped countries find themselves capable of paying for necessities. Internet access is expanding. Societal aspects of gender equality are being addressed. International Development organizations strive to bridge the technological gap between countries. Through indirect and direct assistance with finances and agriculture, these organizations are paving the way to a more sustainable, collaborative future. International relations are benefiting with this newfound cooperation. Digitalized economics are the future for the development area.