The Sakombi neighborhood in Kinshasa, capital of the Democratic Republic of Congo, is not an area where traditional banks spend their marketing money. The people who live and work here are street hawkers and day laborers, low-income people in the informal economy who are generally considered risky and expensive customers by most financial institutions.

Microfinance institution FINCA thinks differently. It conducts regular sales drives in Sakombi and in similar neighborhoods across Kinshasa, offering new customers the chance to open a bank account with just a one dollar deposit. These marketing drives build on a network of agents that FINCA is rolling out with the help of mobile and biometric technology.

Agent and mobile banking are key components in FINCA’s growth strategy in this market where the MFI sees huge potential. There are few other places in the world where access to financial services is as low as in the DRC. Less than 4 percent of the population of 67 million use banks or other formal financial services, according to the latest estimates from the Central Bank.

“We estimate that at present, 3 percent of our potential market is served by FINCA or similar microfinance institutions, while 97 percent of the Congolese market is still unbanked,” says FINCA DRC CEO Alejandro Jakubowicz.

The agent network is considerably cheaper than a traditional brick-and-mortar expansion, and the biometric point-of-sales devices that agents use are not only convenient in terms of outreach but also solve an important identification problem as few people have national ID cards. Customers essentially have their bank accounts in their fingertips.

To learn more about how FINCA is trying to bank the low-income population in the DRC, have a look at the above video.

Video credit: World Bank

Have you read?

Innovations in Portability for the Developing World

Global Progress in Electronic Payment Systems

Greenfield Microfinance in Africa – Where to from Here?

> Posted by Center Staff

This edition of Top Picks features posts highlighting trends in identification technology and mobile money, as well as a post on new mobile money research targeting user-centered services design.

Innovations in identification technology, namely biometric identification, are discussed in a new Center for Global Development Blog post. The author indicates that key identification areas worth following are remote authentication, the identification of children, standardization and interoperability, and privacy. The post is framed in the context of identification conferences and events, whose content reflects the diversity of identification technology applications, such as in financial services.

There were 219 mobile money services across 84 countries at the end of 2013, with the number of active accounts growing from 37 million in June 2012 to 60 million in June 2013. Those are a few of the main findings from GSMA’s new MMU State of the Industry Report on Mobile Financial Services for the Unbanked. A new MMU Blog post highlights the report and its key insights. Expanding on MMU State of the Industry reports of previous years, this year’s report covers the new areas of mobile insurance, mobile credit, and mobile savings services.

On Next Billion, Camilla Nestor of Grameen Foundation recently shared new research on how user-centered mobile money services design can increase services usage. The research, conducted in Uganda, India, and the Philippines, identified opportunities for improving service navigation, syntax, language, and content, among other aspects. Grameen’s research also found that most of the mobile money services that were studied do not engage many of the traditional communications channels women use to access information.

Image credit: Ianf