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Institute for Workplace Studies-----------------Professor Samuel B. Bacharach

School of Industrial & Labor Relations-------- Director, Institute for Workplace Studies

Cornell University

16 East 34th Street, 4th floor--------------------Stuart Basefsky

New York, NY 10016 -------------------------------Director, IWS News Bureau

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International Finance Corporation (IFC)

 

IN THE FAST LANE: INNOVATIONS IN DIGITAL FINANCE [22 May 2014]

by MARCIA PARADA and GRETA BULL

http://www.ifc.org/wps/wcm/connect/d2898b80440daa039453bc869243d457/In+The+Fast+Lane+-+Innovations+in+Digital+Finance+IFC.pdf?MOD=AJPERES

[full-text, 24 pages]

 

Press Release 22 May 2014

New Study Shows How Innovations in Digital Financial Services are Driving Financial Inclusion in Africa

http://ifcext.ifc.org/ifcext/pressroom/IFCPressRoom.nsf/0/721A2606CD332C2185257CE0003AFD9F

 

Johannesburg, South Africa, May 22, 2014— Major new trends and innovations in digital financial services are opening up the possibility of significantly expanding financial inclusion in Africa, according to a new study released today by IFC, a member of the World Bank Group, and The MasterCard Foundation. The study, In The Fast Lane: Innovations in Digital Financial Services, highlights advances in distribution infrastructure, back-office processes, and product development.

 

Financial inclusion has made remarkable strides in several African countries in the last few years on the back of mobile technology and new business models for the distribution of financial services. In Tanzania, for example, the rate of access to formal financial services has increased from 16.4 percent to 57.8 percent in just four years, demonstrating the dramatic impact of recent innovations.

 

Many of the new innovations surveyed in the study further enhance and improve existing mobile money infrastructure. The study also points, however, to innovations that build on the existing system to supply services such as microinsurance, pay-as-you-go solar power or drinking water, and text books on demand.

 

AND MORE...

 

CONTENTS

Introduction ..........................................................................................................................2

1. Distribution: The Missing Link ..........................................................................................5

Trend: Apps and tools to digitize and speed up the account opening process ............................................................................. 5

Trend: Finger and voice biometrics as additional options for customer authentication ................................................................. 6

Trend: Optimizing distribution – field-force management tools to track field staff, agents, and/or merchants ............................... 7

Trend: Emergence of third-party agent aggregators offering provider-agnostic agent services ................................................... 7

2. Back-office Innovations: Connecting the Dots .....................................................................8

Trend: Application developers supporting financial institutions with mobile money integration .................................................. 8

Trend: Technology companies enabling merchant acceptance of digital payments in-store .......................................................... 9

Infographic: The Future at Hand - innovation in digital financial services .................................................................................. 10

Trend: Payment aggregators enabling online payments and e-commerce.................................................................................. 12

Trend: Leveraging alternative data sources for credit decisions ............................................................................................... 13

Trend: Leveraging alternative data sources for business intelligence ........................................................................................ 14

3. Product Innovation: Reaping the Benefits of Robust Infrastructure ..................................15

Product Innovation for Consumers ..................................................................................15

Trend: Pay-as-you-go for essential goods and services leveraging mobile payments infrastructure and machine-to-machine connectivity ....................... 15

Trend: Mobile on-demand micro-credit is in demand ............................................................................................................... 16

Trend: Mobile micro-insurance making its way into poor African households ............................................................................ 17

Trend: Formal products building on or leveraging observed informal behaviors and group capabilities ...................................... 17

Trend: Proliferation of financial products offered by non-mobile money providers riding on top of the mobile money platform. . 18

Trend: Consumer financial education – innovations in financial capabilities and rewards-based strategies ................................ 19

Product Innovation for Business: The Case of Agribusiness ...............................................19

Trend: Pushing mobile payments from buyers to farmers for their produce ............................................................................... 19

Trend: Index-based insurance dominating the agricultural micro-insurance space ..................................................................... 20

Trend: Collective purchasing and selling in agribusiness made possible through mobile apps ................................................... 20

Conclusion ..........................................................................................................................21

 

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