Early registration closes April 1. CGAP encourages you to register with a discount code: CGAPMMSVIP to receive a $100 discount. For questions, contact Jim Rosenberg, CGAP Communications Officer.

Mobile Money Summit 2008 is two-day conference designed for senior executives from financial services institutions, mobile network operators, development organizations, solutions vendors and regulatory and policy makers. The inaugural event will provide for the first time a comprehensive demonstration of the addressable markets, showcase new solutions, and share key success factors and learnings from around the world. The goal of the Summit is to stimulate greater understanding and collaboration between all stakeholders — globally, regionally and locally. Most importantly, Mobile Money Summit 2008 will better equip participants to develop and deploy their own Mobile Money portfolio effectively, efficiently and at scale.

At this highly interactive event, you will learn:

• How Mobile Money can drive top-line growth and customer value in both financial services and telecommunications
• How Mobile Money solutions can drive economic growth and financial inclusion for individuals, communities and countries
• Best practices in the market today, and key innovations coming to market
• Strategic, operational, regulatory and market challenges to effective deployment and scale
• Key propositions for various customer segments in different markets.
• Rationales for partnership between financial services institutions and telecom companies to deliver converged mass market Mobile Money.
• Where and how to kick-start activity most effectively.

…MFIs (microfinance institutions) are inhibited from extending their reach because they lack a flexible, cost-effective technology infrastructure that enables them to expand their operations to provide loans to more people and to develop new products and services. Many MFIs are still using pen and paper or simple spreadsheets to process loans. A 2004 study by the Consultative Group to Assist the Poor (CGAP) showed that just half of all MFIs around the world have automated information systems, and those that do invest in technology spend duplicative resources on custom-built systems that are extremely costly and difficult to maintain.

No doubt. We hear this all the time from MFIs - its hard, if not impossible to roll out electronic channels on the front end without improving the back end first. 

Want to know more? We’ve got lots of research…..

Looking at the agenda, the three day conference brings together an amazing group of around 1,500 of the region’s microfinance providers, its networks, governments, donors, and even the royals with the participation of H. M. Queen Sofia of Spain.

CGAP is organizing a panel on technology’s potential to increase outreach and depth of access to finance. Our project partners Visa Credibanco and GXI, as well as Opportunity International will share their lessons learned and challenges to implement technology projects.

Watch this space for more.

Want to know more? Visit here for the full agenda.

We’ll be posting presentations as we get them…and this link should take you to a live video stream of the event.

Using Technology to Build Inclusive Financial Systems
Focus Note No. 32, January 2006 (Chinese, pdf)
Some of the innovations commercial banks need to service poor clients may be found in information and communications technologies (ICTs).This Focus Note addresses the following questions: Can banking technologies, applied innovatively in developing countries, make microfinance profitable for formal financial institutions? Will they reduce costs to such an extent that banks could profitably serve even those whom MFIs have mostly excluded to date, such as very poor and remote rural customers? Will these customers be comfortable using technology?

Use of Agents in Branchless Banking for the Poor: Rewards, Risks, and Regulation
Focus Note No. 38, October 2006 (Chinese, pdf)
Use of Agents in Branchless Banking for the Poor: Rewards, Risks, and Regulation
This Focus Note examines the experience of five pioneering countries–Brazil, India, South Africa, the Philippines, and Kenya–where agent-assisted branchless banking that targets poor customers is already a reality. It introduces the main issues involved in regulating branchless banking, particularly regarding the use of retail agents.

Not one or two or three, but four presentations at the AMC in Kampala, Uganda, dealt with the use of technology for increasing access to financial services. Richard Ketley from Genesis Analytics talked about Alternative Service Delivery Mechanisms and the card and phone revolution in Africa. His main conclusion was that African microfinance institutions (MFIs) can leverage existing technology such as mobile phones, ATMs and the internet to counter the negative impact of operating in a high cost environment and more often than not using inefficient business models.

Meliza Agabin, working for the USAID-funded Microenterprise Access to Banking Services (MABS) Program in the Philippines, showed how rural banks have been able to serve customers better by making use of Globe Telecom’s G-Cash mobile banking solution. Customer comments such as “So easy to use,” “Very convenient,” and “I no longer waste my time” speak for themselves. Frankfurt School of Finance & Management’s Willemien Libois introduced some examples how cell phone technology is currently used by banks in Africa.

And finally, I presented on behalf of CGAP’s Technology Program on various business models in branchless banking we have looked at in seven countries around the globe, including Pakistan, and how regulators have responded to them. It was obvious that many participants were hearing about this for the first time, but that they also wanted to know much more. One participant summarized her impressions by saying “Technology is going faster than us.”

The subsequent discussion focused on a number of practical issues with branchless banking models: What are the costs and returns for operators? What is the experience with fraud and customer satisfaction? Which criteria can be used to select agents? What risk mitigation measures can be used by the bank or mobile operator? Who is best equipped to build up an agent network? How do you manage liquidity across the network of agents? To many of these questions there is no clear answer yet. But practical experience is growing fast, and if we try to keep up with the pace of technological and business innovation, we might be much better positioned to present answers at the next African Microfinance Conference in two years time.

I have never been approached by so many people at the end of a presentation before. The interest to learn more about this is immense. Branchless banking is regarded by many as a way to reduce the still huge gap in outreach. Yet it seems to be an open question where to start. Is the first step to create a policy and regulatory environment which opens up space for branchless banking while at the same time mitigating any new or increased risks? Or isn’t it much more important to encourage the banking and also nonbanking sector to experiment in the branchless banking sphere? What we can say so far is that this probably depends very much on the country context. Regulation can play a role in promoting the use of technology for financial inclusion, but without some creative entrepreneurs you won’t get anywhere.

presentation (pdf)

Aid agencies are wising up to new ways of delivering help. They’ve realized that smaller amounts of aid, spread out over time and in the form of cash, can help poor people build there own safety nets, before a crisis hits. Cash is also much cheaper and more efficient way of delivering aid. Some 65% of America’s US$ 2 billion food aid program is eaten up by red tape and logistical costs, according to a US government report.

By contrast, the cost of cash payments typically average less than 10% of the total grant amount, and often just 2-4%, according to forthcoming research from the UK’s DFID. But if cash is cheaper to move, it’s also susceptible to fraud and theft. On a recent CGAP trip to Malawi, Concern Worldwide reported that every payment of cash was counted 9 separate times during a social safety net program in 2005. That’s 9 opportunities for an extra hand to dip into the envelope, not to mention the security headache and expense of moving large amounts of cash over unsafe rural roads.

Technology can help. Providing a recipient with a magstripe ATM card and funneling payments electronically cuts out many of the intermediate steps for counting and moving money where the risk and expense reside. And for those of us interested in access to finance, it also provides banking, often for the very first time. South Africa’s Sekulula Card is an example.

Developed by AllPay, a division of Absa Bank, the Sekulula Card is designed for government grant recipients to access their grants electronically. Absa opens a basic transactional bank account for recipients and issues a Visa Electron-branded debit card usable at any Visa certified ATM or POS terminal. Pioneered in Gauteng province, by 2005, nearly 500,000 people or two-thirds of all recipients in the province had selected this option. Clients are allowed to make two free withdrawals per month and do not need to maintain a minimum balance. In November 2006, Absa announced that cellphone banking services would be extended to Sekulula account holders.

Services like Sekulula work where ATM and POS networks are already in place. But what about areas where no banking infrastructure exists? CGAP and the Financial Sector Deepening Trust in Kenya have partnered to tackle this head on through a Social Protection Payments Challenge Fund. The aim is to co-finance prototypes that deliver social payments plus basic savings, remittance and other financial services to 68.000 people in food insecure households living in the arid northern part of Kenya.

The Challenge Fund has made two awards: to Vodafone, which will adapt its M-Pesa mobile payments solution recently launched in Kenya, and a consortium of Sevak Solutions, Kenya Commercial Bank and Paynet Holdings, which owns Pesa Point, Kenya’s largest ATM network. The Sevak consortium will create a solution based on POS terminals and mobile ATMs. Both Vodafone and Sevak will identify local merchants with excess liquidity to distribute payments on behalf of the government. CGAP will evaluate these pilots to extract lessons for others to use in building financial services around social payments.

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