Mobile Phones for Microfinance

April, 2006     Gautam Ivatury, Mark Pickens

Some banks interested in reaching unbanked customers believe that a mobile phone banking channel will be less costly than bank branches and that many poor people would be more comfortable using mobile phones to do their banking. Network operators see mobile commerce and payments applications (such as e-money) as a service that can generate more revenue on an existing network infrastructure and reduce customer turnover. CGAP, in partnership with the Vodafone Group Foundation and the UN Foundation, is now doing research in the Philippines and South Africa to find out what makes poor people use or reject these services and how far remote mobile phone banking can go.