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Interest Rates on Microloans in Russia: How Much Is Too Much?

Just as the dust settled after a controversial entrance of new players in the Russian microfinance sector about a year ago – those claiming themselves to be ”microfinance organizations” and yet charging 730% interest per annum, another “innovative microfinance” product has totally shocked visitors of the Russian Post, as reflected in a multitude of blogs and in numerous media articles published in recent weeks.

Can MTOs Accelerate the Adoption of Mobile Remittances?

As our understanding of the factors that lead to customer adoption of branchless banking expands, there is a growing consensus that for international remittances services to reach a significant level of scale, they will require an existing mobile money ecosystem that allows for downstream transactions which give users access to a wider array of cost-effective services and products such as payments and access to savings.

ARPU Going Low: The Role of Financial Services in Latin America

The model for obtaining significant revenues must be one in which the carriers are efficient players of the ecosystem, beyond the mere provision of connectivity to mobile phones.

How Perception and Trust Shape Adoption

How does a company, or in this case – a new player in the financial services market – change the way it is perceived among a new customer segment it is trying to reach with new products and services?

How Does Mobile Money in Kenya Affect Financial Inclusion?

The rapid uptake of mobile money transfer in Kenya has ignited enthusiasm globally over the potential to bank poor people via the platform of mobile phone technology. On the basis of research undertaken for Financial Sector Deepening Kenya, I argue that the evidence suggests an alternative explanation which means that formal service provision for poor people needs to be thought through in a very different way. It means going beyond the expectation that mobile technology can adequately lower transactions costs to produce a revolution in inclusion, to recognising that managing financial resources has important social dimensions.

Jipange Kusave: A Mobile-only Attack on the Kenyan Mattress

When we launched Jipange KuSave – a mobile-only savings product – in Kenya in early 2010, our goal was to out-compete the mattress. Back then, Safaricom’s M-PESA service was in hyper-growth phase and ramping up to become the de facto national retail payment system. But even more exciting was M-PESA’s potential as a pervasive and low-cost delivery channel for a wider set of financial services.

Can Third-Party Providers Lead to New Business Models?

Until recently, Zoona, formerly known as Mobile Transactions could have been considered the best kept secret in Africa. Operating in Zambia on a shoe-string budget, they have been developing their own unique business model for electronic financial services slowly and with little media attention. Now, as of February 2012, this small company has secured investments from three big investors, Omidyar Network, ACCION Frontier Investments, and Sarona Asset Management. All three are banking on the fact that Zoona’s experience and innovative approach to serving a range of consumers situates them to fill crucial gaps in the mobile money transactions and payments market in Africa.

Powering Remittances Flows between Russia and Tajikistan

It can be concluded the Russia-Tajikistan corridor offers some interesting insights on how one might link financial products to remittance flows, but it also provides insights on the basic challenges accounting for why no significant scale has yet been reached.

Remittances in Russia and Tajikistan

The potential seems huge to make use of a promising mix of (i) people on both ends of the remittance corridor being in regular contact with banks; (ii) most of the senders and receivers still being unbanked; (iii) the banks having detailed records of remittance clients’ financial flows; and (iv) intense and growing competition among banks, which has led to declining fees for customers to remit money.

Branchless Banking in India: More Reasons for Optimism

In keeping with this optimistic view of a still uncertain India venture, we conclude with three more positive items to highlight. Two reflect new changes by the government and one goes back to the fundamentals.

Mobile International Remittances in the Philippines

Last week, we began a blog series and released a CGAP report on international remittances through mobile banking channels. The series continues this week with guest blogger Paolo Baltao, President of G-Xchange, Inc. (GXI), a wholly owned subsidiary of Globe Telecom in the Philippines. G-Xchange’s GCASH is one of the first mobile wallet services in the world and has been offering international remittances since 2004. In this post, Paolo shares some of the lessons GXI has learned in the past eight years.

Making Electronic Money and Banking More Discrete

Electronic money is intangible, and that makes it intrinsically a lot more discreet than piles of cash or physical forms of savings such as jewelry or livestock.

What Do International Remittances Mean for Mobile Money?

Since remittances to developing countries were estimated at about $351 billion for 2011, capturing even a small share of this market could be a transformational opportunity for mobile money providers – right?

Join CGAP’s Event and Webcast Today on New G2P Focus Note

Join us to discuss the findings from the recent CGAP Focus Note, Social Cash Transfers and Financial Inclusion: Evidence from Four Countries.

Is There a Business Case for Offering Services to G2P Recipients?

The biggest challenge when it comes to the business case for banks is that the amount per grant payment is small, and as client research has shown, very little of each payment is left behind in the form of savings.

Eko’s Mobile Banking: A Basic Payments Product

Eko was the first company dedicated to a mobile phone-based basic savings account and payment service for the unbanked in India. Launched in 2007, Eko has carefully developed a mobile-based service usable on the most basic of handsets and continually revised and re-fashioned its approach.

Details Matter: Why Isn't Insurance More Popular?

Formal insurance products designed for poor households could theoretically provide critical protection against high-impact events that can push a household deeper into poverty, or send it back into poverty when it manages to lift itself up.

Segmentation: A Tool to Enhance Activity Levels

Customer segmentation is a powerful marketing tool which can be used to understand customers, design products and tailor advertising messages. It’s based on the premise that some customers will find a service extremely valuable while others couldn’t care less about it.

Will G2P Recipients Use Financial Services if Offered to Them?

Our recently released Focus Note on Social Cash Transfers and Financial Inclusion looks at the evidence from four large and well established programs in Brazil, Colombia, Mexico and South Africa to attempt to answer three broad questions that are relevant to different stakeholder groups.

Strong Customer Activity Should Begin on Day One

One of the keys to high levels of customer activity is getting it right from the very beginning – ensuring that the registration agent and first customer transactions are both focused on long-term customer activity.