The following post was originally published on the CGAP Microfinance Gateway.

In follow up to the Financial Inclusion 2020 Global Forum in October, Susy Cheston, Senior Advisor at the Center for Financial Inclusion (CFI), shares key takeaways from the event and what the ongoing impact of this gathering will be leading up to the year 2020.

The Financial Inclusion 2020 Global Forum was a new event in the industry. Why did CFI organize this event?

Our overall goal for the FI2020 Global Forum was to put forward a vision of full financial inclusion for all by 2020, bringing together the leaders from the private and public sectors who can make that vision a reality. Part of the premise was that these different stakeholders don’t often talk with each other, and that there was value in enabling people who ordinarily work on separate aspects of financial inclusion to hear from each other and become more aware of how their own work fits into the broader picture.

Full financial inclusion by the year 2020 is an audacious goal. Did participants agree it was an achievable one?

Very much so. Participants were very optimistic, especially in light of recent innovations in technology, product development, and regulation.

Anil Aggarwal of Money2020 said it this way in the closing plenary: “Financial inclusion for all is not only possible by 2020, but inevitable. There is more potential for innovation in money in the next 7 years, than in the last 30 years. By 2020 I believe we will see a profound and fundamental shift in the way people do business, manage, and spend money.” Anil wasn’t the only one to highlight the potential. There were exciting looks at the way forward from pioneers in innovation such as Nick Hughes of M-PESA and M-KOPA and Dylan Higgins of Kopo Kopo, regional financial services providers such as AccessBank and the Commercial Bank of Africa, and the CEOs of multinationals such as Citigroup and MasterCard Worldwide, to name a few.

That’s not to diminish the magnitude and complexity of the obstacles that must be overcome to achieve this goal. For example we had healthy discussions about people who have access to services but don’t use them, or don’t benefit from them, or are even harmed by them in some way. We also talked about some of the marginalized groups that are especially vulnerable or have greater barriers to inclusion, such as youth, the elderly, persons with disabilities, and women. The push for access has to go hand in hand with the push for protections for customers and a passionate commitment to understanding customer needs such that our services can truly add value to their lives.

To read the rest of this post, visit the CGAP Microfinance Gateway. 

Image credit: The Center for Financial Inclusion

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Providing financial services to entrepreneurs is a challenging operation in developing countries where small businesses may be isolated in a rural village without reliable roads or internet coverage. Service providers must pay the high costs of employing staff to reach out to remote villages while capturing limited revenue from small-scale products. Yet entrepreneurs in these regions need tools like credit and insurance to make investments and grow their businesses as just as do their counterparts in more developed regions.

Mobile phones are changing the financial landscape helping to expand the possibilities of service models. With novel mobile solutions to bridge the financial access gap, innovators can provide entrepreneurs with new tools and opportunities to support their businesses.

Here are a few cutting-edge models rendering financial services more portable:

Portable Bank. Opportunity International (OI) is putting its bank on wheels. With a portable bank that offers savings, loans, and other such financial services regularly circulating within walking distance of clients’ farms or small businesses, entrepreneurs do not have to miss out on business to trek to the bank. OI is developing these portable bank branches in locations around the world. OI also offers electronic wallets that allow customers to make deposits on mobile phones. With this cashless solution, the bank reduces both the risk of client theft/robbery and also the likelihood of staff fraud. OI’s electric wallets are currently in use in Malawi and seven other African countries.

Portable Credit. The Entrepreneurial Finance Lab (EFL) is helping banks, MFIs, and other partners improve operations with portable technology. Not only can loan officers complete credit applications electronically on a mobile phone or tablet, but they can also collect photos and the precise location of their clients with the use of mobile GPS. With near-real-time scoring of the EFL Tool, an application that captures the ability and willingness of customers to repay a loan, banks have the opportunity to pre-approve clients on the spot. The improved efficiency of automated data collection and credit assessment decreases service turnaround time and increases credit access. The EFL Tool has been used in over 20 countries to date and has processed over 50,000 credit applications.

Portable Insurance. The mobile network operator, MTN, has partnered with Hollard Insurance Group to offer Mi-Life, a mobile phone life insurance, which provides entrepreneurs and their families with financial security in the case of death. MTN clients can buy life insurance, pay premiums, and initiate claims using their mobile phones and SMS. By using mobile phone technology that keeps servicing cost low, MTN can offer insurance premiums a low as $0.65 USD/month. If clients have enough money deposited, the entrepreneurs among them can also use their insurance policy as collateral when applying for loans. Mi-Life is available to MTN Mobile Money users throughout Ghana.

Portable Asset Financing. Portable asset financing enables entrepreneurs to invest in costly assets by making small installment payments with a mobile phone. This financial tool opens a large range of opportunities to enable low-income consumers to access utilities and investments. Former head of Vodafone’s Global Payments and M-PESA founder, Nick Hughes, helped develop a company called M-Kopa. M-Kopa enables Kenyans to acquire a device, like a d.light solar home system up front and pay for its use with affordable installments. M-Kopa operates with small computer chips integrated with M-PESA that are inserted into the devices allowing customers to make electronic payments.

Image credit: Entrepreneurial Finance Lab

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