What do Austin, Toronto, and Vienna have in common? According to Greg Clark, global head of Future Cities & New Industries at HSBC Group, each offers clues on how cities can continue to deliver on their promise of economic opportunity. Cities are the original engines of social mobility and have enabled people to escape poverty over the last 400 years, he says.
In Austin, liberal land-use policies have opened the door to more affordable housing in the fast-growing city. Meanwhile, in Vienna, major investments in public transportation have made getting around the city cheap and easy. And in Toronto, thoughtful approaches to public education have helped bring students from immigrant and refugee families from the margins to the center of the educational process.
Still, many cities arent delivering these kinds of inclusive opportunities for their residents. Speculative housing markets in some cities attract more investors than families. And in others, haphazard zoning rules minimize public spaces and deprioritize public transit. The result? The ladder of social and economic mobility is broken, making some cities exclusive rather than inclusive. I think your location matters a lot more than we realize when it comes to inclusion and your socioeconomic status, says Miguel Gamio, head of global cities at Mastercard.
Mastercard created the head of global cities job for Gamio in 2018, tasking him with building partnerships to address important issues facing urban areas and the people who live there. As part of this role, Gamio took the helm of City Possible, a network of urban leaders, academics, and corporate partners working on issues such as sustainable urban development and urban planning to protect cities most vulnerable residents. Individual cities serve as test cases for how best to address these issues, with the hope that successful initiatives can provide the model for these strategies to be scaled more broadly around the world.
One key pillar of City Possible is to deliver alternative financial services to underserved communities. These communities face a range of barriers to financial inclusion, from a lack of access to traditional banking services to an inability to take advantage of an increasingly digitalized financial system. While many cities subsidize such things as housing and food, they often fall short when it comes to addressing issues around financial equity and inclusion. This is a core element of how people can find their way to opportunity and prosperity and to being an active part of society and the economy, Gamio says.
Los Angeles recently took a creative approach to financial inclusion with its Angeleno Connect program. Developed with Mastercard and MoCaFi, a financial technology firm focused on closing the racial wealth gap, Angeleno Connect provides a no-fee debit card and mobile app to residents without bank accounts. The card has given the local government a streamlined way during the pandemic to disburse financial support and also gives users access to scores of city services such as making park reservations or applying for a business license.
Perhaps most importantly, Angeleno Connect gives users immediate access to no-fee banking. For unbanked populations, the simple task of cashing a check can mean giving up a portion of that money to a check-cashing service. With their Angeleno Connect card, users can deposit checks directly to their account using the programs digital app and even make in-person, no-fee deposits at places like 7-Eleven and CVS. The Angeleno Connect card is a really good prototype, and there will be many more like it, Clark says.
Its not enough to simply give people easy access to deposits. More steps are necessary on the march toward financial inclusion, including education around making smart money decisions and how building credit can open doors to other financial opportunities. For instance, climbing the ladder of social and economic mobility gets easier when a bank will lend capital to launch a business or when an individuals financial literacy helps them consistently make smart saving and spending decisions.
Thats a journey that is best taken with strong partners. Gamio notes that the Angeleno Connect program wouldnt have been possible without the public-private partnership behind the initiative. We each have different strengths and weaknesses and different roles in society, he says. I believe 100% that collaboration is a superpower.
Consider the recent partnership between Mastercard and city leaders in San Jose: The citys Cash for Trash programpart of its BeautifySJ initiativeincentivized unhoused individuals to clean up trash around encampments as part of a larger effort to combat blight. In exchange for their cleanup efforts, they were given reloadable cards from Mastercard. In this case, both Mastercard and city leaders had a crucial role to play. Gamio says city workers simply couldnt carry around cash to give to individuals; and Mastercard relied on the credibility and expertise of the city to oversee the program.
This kind of collaborative partnership plays a central role in scaling these innovative programs around the world. For instance, the model that gave rise to the Angeleno Connect project is being considered in dozens of other cities in the U.S. and beyond. Thats the power of this common framework weve created, Gamio says. Its not only about inclusion within the context of one city, but its about impacting progress across many cities at scale.
Read more from the original source:
How innovative partnerships are helping cities deliver economic opportunities to all - Fast Company
