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The Bill & Melinda Gates Foundation today released a new open-source software for creating payment platforms that will help unbanked people around the world access digital financial services. The software is designed to provide a reference model for payment interoperability between banks and other providers across a country’s economy. It is available now, free-of-cost, for software developers to adapt and banks, financial service providers and companies to implement. Information on the code can be found at mojaloop.io .

Current data from the World Bank shows that nearly two billion people in developing economies lack bank accounts and miss out on the benefits and security that basic financial services provide. Digital financial services, such as mobile money on cell phones, have rapidly expanded over the last two decades because they are convenient for users and cost-effective for companies aiming to serve new markets. In Kenya, an estimated 194,000 households have moved out of extreme poverty due in part to their access to M-Pesa, a mobile money platform, and users’ ability to save money more effectively. Digital financial services are now available in nearly 100 countries according to GSMA, an organization representing mobile network operators. However, global expansion of these services—especially to the world’s poor—has been hampered, in large part, by a lack of interoperability between digital financial services and payment platforms.

The new software, called Mojaloop , establishes a blueprint for connecting today’s financial services sector, and can be used as a solution to barriers that banks and providers seeking interoperability have traditionally faced. Delivering financial services to the poor is prohibitively challenging for many businesses because they struggle to invest adequately in complex technology while maintaining a commitment to low-cost, inclusive services. This has led to a prevalence of consumer payment options that are out of reach for many people in developing economies, or which limit customers’ ability to transact across products, banks and borders. These and similar challenges have dissuaded many companies from expanding into developing markets altogether.

Mojaloop can be used by financial institutions and commercial providers, to simplify and reduce the cost of developing inclusive payment platforms. It was designed to serve ultimately as a model for national payment switching systems that, for example, enable an individual’s digital wallet to connect with her employer’s bank account and her children’s school account to complete monthly transactions. The code can also be applied to adapt and improve existing services.

“Interoperability of digital payments has been the toughest hurdle for the financial services industry to overcome. With Mojaloop, our technology partners have finally achieved a solution that can apply to any service, and we invite banks and the payments industry to explore and test this tool,” said Kosta Peric, Deputy Director, Financial Services for the Poor, at the Gates Foundation. “Just as the internet revolutionized digital communication, open-source solutions like Mojaloop can spark innovation and democratize access to digital payments, empowering billions of new customers and driving massive economic growth in developing markets.”

Mojaloop (building off the Swahili word “moja,” which means “one”) was created in partnership with fintech developers Ripple, Dwolla, ModusBox, Crosslake Technologies and Software Group, using cutting-edge technology such as the Interledger Protocol, a solution for settling funds among multiple providers across their individual systems. It joins other promising digital financial software, but is the first model that can help extend interoperability from mobile money providers to any bank, merchant or government institution in a customer’s economy in a way that specifically meets the needs of the poor.

“Interoperability is necessary both for financial inclusion and market maturity, but it is a complex thing to achieve,” said Benno Ndulu, Governor of the Bank of Tanzania, the country’s national bank. “We are excited to explore implementation of this because of how it can simplify that capability for businesses and governments, and speed up access to financial services.”

“As we modernize and develop national and cross-border payments infrastructure in Africa, the only way to sustainably reach and serve the world’s unbanked communities is through new technologies,” said Chris Hamilton, CEO of BankservAfrica. “Our aim as an organization is to offer national payments platforms for the next generation of financial innovators and Mojaloop gives us some tantalizing new options for doing that in a way that integrates with the entire national economy.”

Developers can access the new software on GitHub, the world’s leading open-source development platform. It includes four components: an interoperability layer, which connects bank accounts, mobile money wallets, and merchants in an open loop; a directory service layer, which navigates the different methods that providers use to identify accounts on each side of a transaction; a transactions settlement layer, which makes payments instant and irrevocable; and, components which protect against fraud. The software will not be owned or implemented by the Gates Foundation. It will be used in the foundation’s ongoing work to promote the development of pro-poor, digital payment platforms.

Mojaloop was created by the Gates Foundation’s Level One Project, which is aimed at leveling the economic playing field by crowding in expertise and resources to build inclusive payment models to benefit the world’s poor. Alongside Mojaloop’s development, the project also brought together four mobile systems companies—Ericsson, Huawei, Telepin, and Mahindra Comviva—to develop an Open API for mobile money interoperability. These APIs will allow mobile money providers to integrate seamlessly with Mojaloop and products built from it.

“In order to achieve the full potential of mobile money, we must evolve today’s complex and often fragmented digital payments ecosystem,” said Mr. Shi Yaohong, President of Software Product Line at Huawei. “I look forward to exploring opportunities to leverage Mojaloop to help us achieve our goal of bringing digital financial services to all poor and low-income customers.”

For technical documentation and to contribute and use the Mojaloop software, visit github.com/leveloneproject . For more information on the Level One Project, visit leveloneproject.org .

About the Bill & Melinda Gates Foundation

Guided by the belief that every life has equal value, the Bill & Melinda Gates Foundation works to help all people lead healthy, productive lives. In developing countries, it focuses on improving people's health and giving them the chance to lift themselves out of hunger and extreme poverty. In the United States, it seeks to ensure that all people—especially those with the fewest resources—have access to the opportunities they need to succeed in school and life. Based in Seattle, Washington, the foundation is led by CEO Sue Desmond-Hellmann and Co-chair William H. Gates Sr., under the direction of Bill and Melinda Gates and Warren Buffett.

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