Financial Service Delivery to the Poor and Technology

We are conducting primary research on understanding the ways in which rural and urban low-income households access and use financial services from formal and informal providers, including microfinance providers.

Our work involves investigating ways in which the use of technological solutions to enable various aspects of financial service delivery can result in more cost-effective and scalable operations for providers, and cheaper, better quality finance for the poor. To this end, we are working on understanding the financial, social and usability factors involved in effectively deploying technologies to improve financial service delivery to poor clients.

Image credits: PRADAN, CCD/ Ekgaon

People involved: Aishwarya Ratan, Jonathan Donner, Kentaro Toyama, Indrani Medhi, Mahesh Gogineni, Shabnam Aggarwal, Angelin Baskaran, U. Vasudha, Carol Savia Peters, Sean Blagsvedt, Rajesh Veeraraghavan

Organisations involved: Ujjivan, Pradan, Ekgaon/CCD, BASIX, Unitus, CGAP

>>NEW!     Costing tool to evaluate the financial viability of front-end technologies for microfinance data collection/management 

This Excel-based costing tool allows microfinance institutions to perform quick, yet accurate, cost-benefit analyses when evaluating different technology options to enhance their front-end data collection and management processes, prior to/during pilot implementation.

Available here

>> Mobile-banking Research partnership with the Consultative Group to Assist the Poor (CGAP)

Microsoft Research India and CGAP’s Technology Program are collaborating on joint research to better understand the use of mobile phone-enabled channels to deliver financial services to low-income clients.  The collaboration focuses on User-Interface design for illiterate and semi-literate clients of m-banking channels. In addition, the project involves joint explorations in understanding the social and economic context and impact of mobile-banking on poor households.

Case studies

>> Interventions to improve Self-Help Group (SHG) style bank-linked microfinance operations

Ratan, Aishwarya. A preliminary assessment of CCD and Ekgaon's MIS pilot intervention to improve microfinance operations. December 2006.

Ratan, Aishwarya. An assessment of Pradan's 'Computer Munshi' intervention to improve SHG microfinance operations. September 2006 (revised Sept 2007).   paper

>> Interventions to improve Joint-Liability Group style intermediated microfinance operations

Gogineni, Mahesh. Initial assessment of a pilot intervention run by BASIX involving the use of handheld devices for the collection of microfinance repayments. June 2007.   paper

Ratan, Aishwarya, Mahesh Gogineni and Shabnam Aggarwal. Designing and assessing the viability of a potential mobile-phone based remote data collection solution for Ujjivan's new client acquisition process. December 2006 - May 2007.   paper

Pichai, Hariprasad and Srikrishnan Ganesan. Study of Delivery of Financial Services in Rural Areas through ICT: An assessment of the NBFC Sanghamithra's Simputer pilot. August 2006.  paper

Medhi, Indrani and Aishwarya Ratan. Learnings from a usability test of Citibank's biometric-ATM prototype. June 2006.

Papers/ presentations

Donner, Jonathan. (2007, September). M-Banking. id21 insights #69, Institute of Development Studies, University of Sussex.

Costs, Contacts and Convenience: Leapfrogging Access to Finance with Mobile Phone Technology. (2007, September 18). Presentation at the CGAP/ IFC/ VISA conference on "Next Generation Access to Finance: Gaining Scale and Reducing Costs with Technology and Credit Scoring", Washington D.C.  presentation

Donner, Jonathan. (2007, August 23). M-banking and m-payments services in the developing world: New channel, same ties? Paper presented at the panel on living and livelihoods at HOIT2007: Home/community oriented ICT for the next billion, IIT Madras, Chennai, India.  presentation

Donner, Jonathan. (2007, 23-24 May). M-banking and m-payments services in the developing world: Complements or substitutes for trust and social capital? Paper presented at the Preconference on Mobile Communication at the 57th Annual Conference of the International Communication Association, San Francisco.   paper :: presentation

Ratan, Aishwarya. (2007, March) Overview presentation on Microfinance and Technology, Techfest 2007.  presentation

Ratan, Aishwarya. (2006, December). "Deconstructing 4 Microfinance Myths." Microsoft Research Technical Report.  paper

Resources on this topic

Mobile-phone banking:

South Africa (WIZZIT): Ivatury, Gautam and Mark Pickens. "Mobile Phone Banking and Low-Income Customers: Evidence from South Africa." CGAP, 2006.

Philippines (Globe and SMART): Wishart, Neville. "Micro-Payment Systems and Their Application to Mobile Networks. Infodev / World Bank, 2006

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