Federal Reserve Bank of San Francisco

Community Development

The Latest Frontiers for Financial Inclusion: Using Mobile Phones to Reach the Unbanked

Author(s): Tillman Bruett, UN Capital Development Fund

March 2011

Community Development Investment Review

Financial institutions are not winning any popularity contests these days. Banks are derided as the instigators of crisis and pillagers of wealth instead of caretakers of savings and partners in growth that they are meant to be. Even worse, many claim that it was policymakers’ obsession with helping uncreditworthy low-income households gain access to mortgages that caused the crisis in the first place. Subtly implicating the poor in the colossal mismanagement of the financial sector by the (primarily) rich and the regulators that enable it is wrong. The truth is that banks and other financial service providers haven’t done nearly enough to help the poor. The good news is that this is beginning to changeand we have the world’s mobile network operators to thank.

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