CGAP estimates the 140 million poor people receiving regular payments from their governments exceeds the global number of people with an active microloan. Yet probably less than a quarter of all G2P payments to poor people land in a bank account.

That number looks poised to rise dramatically, however, as more governments adopt electronic payment programs in an effort to cut costs, reduce fraud, and promote inclusion in the banking system.

In Brazil, the Ministry of Social Development is in the process of migrating 12 million recipients of Bolsa Familia, the financial aid program that represents a quarter of Brazilian families, away from an electronic benefit card and towards the option of a simplified account. In Russia, Argentina and South Africa, benefits recipients can use debit cards to collect and spend government payments, and, in some cases, to access banking services.

These are all welcome developments for proponents of financial inclusion, as access to bank accounts helps poor people to save, build assets, and cover emergency expenses. Nonetheless, providers of electronic benefit payment programs still face challenges that, left unaddressed, could stymie efforts to expand access to financial services. One issue is that banks and governments have not yet determined the full expenses associated with operating electronic payment programs. Another lingering question is whether benefits recipients will continue to access financial services if they are no longer receiving government payments.