The monthly newsletter from the Indicus Centre for Financial Inclusion documents the latest news and views in the financial inclusion space, to provide a knowledge base that will help build understanding around how to accelerate the poor’s access to high-quality financial services.
This month we lead with two pieces revolving on moving consumers from cash to digital payments, which form the primary building block for financial inclusion. These include a) an article by Ignacio Mas and David Porteous which highlights the significant efficiency gains from transforming into a cash lite economy using mobile networks and b) a paper by Jake Kendal, Graham Wright and Mireya Almazan that discusses the emerging challenges in new sales and distribution models in mobile financial services.
Ignacio Mas and David Porteous discuss the efficiency gains that result from a transition away from cash - greater business innovations, more control over financial lives, greater effectiveness for the government etc. However, for building an effective cash-lite system all stakeholders-banks, telecom companies, distributors and regulators will have to jointly work to create an interoperable digital payments grid.
This paper by Jake Kendal, Graham Wright and Mireya Almazan critically analyses the novel mobile based sales and distribution approaches adopted by financial service providers. It uses case studies and interviews with practitioners from Bangladesh, India, Pakistan, Tanzania and Uganda to evaluate emerging challenges in this uncharted territory. They conclude that appropriate application of technology and simplification and streamlining of sales procedures to the maximum possible extent are key principles to keep in mind.
Section I: Policy – the latest from India’s policymakers