Archive for: January, 2008
by Jim Rosenberg: Thursday, January 31, 2008
 Mobile banking and other technologies need a balanced regulatory approach
Washington D.C. (January 31, 2008) – Basic, everyday financial services are out of reach for more than two billion people in developing countries. But the rapid growth of branchless banking – including mobile phone banking – is reducing the cost and expanding the availability of such services.
“All of this innovation presents challenges and opportunities for regulators,” says Elizabeth Littlefield, CEO of CGAP. “Policy will determine not only where branchless banking is allowed, but also which business models turn out to make economic sense - and how far they will go in reaching poor people.”
Regulating Transformational Branchless Banking is a product of collaboration between CGAP and the UK’s Department for International Development (DFID), in partnership with the GSM Association, the global trade association for over 700 mobile phone operators. The authors also benefited from conducting three of seven diagnostic missions with the World Bank’s Financial Markets Integrity Unit.
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by Hannah Siedek: Tuesday, January 29, 2008
It is nothing new that access to credit to small businesses and low-income individuals is limited in many developing countries. One of the many reasons, besides lack of collateral, informal economic activity, and physical distance to credit providers, is the lack of a formal credit history in a local credit bureau.
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by Jim Rosenberg: Monday, January 28, 2008
by Jim Rosenberg: Thursday, January 17, 2008
by Jim Rosenberg: Wednesday, January 16, 2008
For decades, India’s government and its central bank, the Reserve Bank of India (RBI), have made the establishment of an inclusive financial sector a key policy priority. Yet in spite of numerous government initiatives and a burgeoning microfinance sector, lack of access to formal financial services remains a problem in India. Less than 59% of adults have access to a bank account and less than 14% have a loan with a bank. With more than 30,000 bank branches, 110,000 cooperatives (one in every five villages), and 150,000 post offices, financial sector policymakers do not believe the number of service points is a major problem.
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by Mark Pickens: Tuesday, January 15, 2008
 They both re-engineer something used for decades in rich countries , rethinking every assumption to make it affordable for low-income clients. And both may be safer than the alternatives poor people are already using.
Tata announced the Nano last week as an ultra simple but stylish car costing US$2500, closer to affordable for Indian families than any other new car. To slash prices, Tata engineers questioned everything conventional wisdom said is a “must have”: why not one large windshield wiper instead of two? Why does the beam connecting the wheel to the axle need to be made of solid steel? Today’s steel is far stronger than what Henry Ford started with, but no one had changed it yet. Less steel equals saved expense, and a lower cost in the quest for something rabidly cost-conscious consumers will buy in emerging markets like India.
But critics are bashing the Nano already for not getting close to meeting environmental and car safety standards like those in Europe, Japan and North America. Isn’t the Nano safer than the typical sight of an Indian family of 6 on one motorcycle, dodging trucks in traffic? 
The lesson might be instructive for those watching the mobile banking space. Would mobile banking, through a licensed bank or reputable mobile carrier, be safer than the informal mechanisms poor people use now: stuffing cash in the mattress? or saving through poorly regulated cooperatives? sending money through bus drivers and friends, who might not deliver it at all? Research is needed to know. Read the rest of this page »
by Jim Rosenberg: Tuesday, January 8, 2008
by Jim Rosenberg: Monday, January 7, 2008
 For reducing poverty, mobile payments and remittances matter but a broader range of services, such as savings, is needed. At CGAP, we think that mobile-based financial services could lead to a fundamental shift in the ‘access frontier’ for low-income people looking to get banking services. This would allow them to manage their affairs better and put a safety net under their family, maybe build assets for the future, and possibly even start new businesses and grow their income.
What do you think?
by Jim Rosenberg: Wednesday, January 2, 2008
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