Electronic Banking for the Poor: Panacea, Potential and Pitfalls

This paper is targeted mainly at institutions that have the resources and capacity to invest in large-scale electronic banking solutions for the poor. Although developing an extensive e-banking solution is beyond the range of most microfinance programs, a range of technology options are presented where microfinance programs can become involved. The author points out that whichever technical option is chosen, the development of an electronic banking solution should consider the customer value proposition, the business case and the local environment for electronic banking. The paper also explores the role of donors in developing an appropriate infrastructure for electronic banking and outlines principles to guide donor involvement in this area.