Pascale Elie saw her hometown fall apart from her house in Port-au-Prince. The massive earthquake that struck Haiti in 2010 left the capital city in ruins. Elie, an economist who was then working for an insurance company, watched as the financial system collapsed in the wake of the disaster. Over a third of physical branches — long concentrated in the capital city — fell apart overnight. Even though only 10% of residents were account holders, hours-long lines formed around the few remaining banks. The country’s fragile power grid failed and left millions of Haitians in the dark. Foreign aid struggled to plug the gap, as distributing cash through traditional means proved difficult and time-consuming — on average, locals waited 12 days to access emergency aid in the midst of Haiti’s worst humanitarian crisis of the 21st century.

Elie eventually quit her job and threw herself into building a solution. She founded a fintech called HaitiPay which in turn launched Lajan Cash, a trailblazing mobile wallet and payments system that allows anyone with a cellphone to get paid, transfer money, purchase from mom-and-pop stores, or receive remittances from abroad. By dialing a short number, clients can send requests for transfers and payments from their phones, without having to rely on an internet connection. Since its early days, HaitiPay has guaranteed that all transactions were traceable and available between different financial institutions — a level of interoperability that remains an exception to the rule in the country. The service was one of the first in Haiti: an innovative company looking to disrupt a slow-moving and inefficient industry whose shortcomings were painfully obvious. “I said to myself, ‘That’s what I’m going to do for the rest of my life,’” Elie told Rest of World

On the surface, her life-long mission was starting to look a lot like a Silicon Valley–scripted underdog fairy tale. Early on, when she envisaged the company, she jumped through all the ludicrous legal hoops required to create a startup in a heavily regulated market. Then, when she looked to attract customers, her company stood against contenders that had dominated the area for generations but stood as yet unaware of fintech’s potential. If things had panned out as the standard Silicon Valley–endorsed fairy tale claims, disruptive innovation and perseverance should have been enough for Elie to beat the traditional players of the local financial scene. 

But, a decade on, it isn’t pioneers like HaitiPay that dominate the fintech scene. Digital wallets and payments are now firmly established in the country’s mostly informal economy. Contrary to the underdog myth that pervades startup culture, the fintech market has been taken over by the establishment — oligarchic banks and telecommunications companies — thanks to archaic regulation and precarious access to funding.

In the aftermath of the quake, the Bill & Melinda Gates Foundation rushed to Haiti with millions in emergency aid, three days after the catastrophe. Less than six months later, it had partnered with the U.S. Agency for International Development to offer a $10 million grant to mobile money solutions that could streamline fund distribution. An initial $4 million would be split between two companies that proposed the best solutions; the remainder would be given to the winners, if and when they hit at least 100,000 transactions in the country. Contestants had to deliver solutions that weren’t only innovative but could distribute funds to a large user base as fast as possible. continue reading

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