MICROCAPITAL BRIEF: Stanford Social Innovation Review (SSIR) Blog, Ignacio Mas, John Staley Offer Regulators, Financial Service Providers Ideas to Increase Financial Inclusion

Ignacio Mas, Senior Advisor to the Financial Services for the Poor Initiative at the Bill & Melinda Gates Foundation, and John Staley, Director of Finance and Shared Services at Equity Bank of Kenya, recently posted an entry on the Stanford Social Innovation Review (SSIR) blog titled “Are We Serious About Financial Inclusion for All?” [1]. Mr Mas and Mr Staley highlight the importance of increasing access to financial services in developing countries and outline their four suggestions for regulators and financial service providers to advance financial inclusion.

Of regulators, Mr Mas and Mr Staley propose that requirements be eased to allow individuals the “opportunity to try the service with low amounts…present[ing identification] documents only after certain account activity thresholds are met” [1]. The authors also argue in favour of increased competition, stating that, “An explicit policy objective should be to increase the contestability of the market at the base of the pyramid” [1].

Of financial service providers, Mr Mas and Mr Staley ask that they move beyond branch-network models to “scalable transactional platforms that are shared across multiple providers…offering customers mechanisms to access banking services beyond their own branches” such as via banking correspondent at retail stores. Lastly the authors suggest that providers must “be better at figuring out customer needs in a much more segmented basis” [1].

By: Alexandra Pattee, Research Associate

Sources and Resources:

[1] Stanford Social Innovation Review (SSIR) Blog, April 20, 2011 “Are We Serious About Financial Inclusion for All””,http://www.ssireview.org/opinion/entry/are_we_serious_about_financial_inclusion_for_all/

Microfinance Paper Wrap-Up, March 22, 2011, “Solutions for Financial Inclusion: Serving Rural Women; By Anjali Banthia, Janiece Greene, Celina Kawas, Elizabeth Lynch, Julie Slama; Published by Women’s World Banking (WWB)”, http://www.microcapital.org/microfinance-paper-wrap-up-solutions-for-financial-inclusion-serving-rural-women-by-anjali-banthia-janiece-greene-celina-kawas-elizabeth-lynch-julie-slama-published-by-world-women?s-ba/

MicroCapital.org Article, February 15, 2011, “ACCION’s Centre for Financial Inclusion Offers Lessons Learned from Nicaraguan Microfinance Crunch, Reiterates Six-Point Agenda For “Recalibration” of Industry Worldwide”, http://www.microcapital.org/microcapital-brief-accions-centre-for-financial-inclusion-offers-lessons-learned-from-nicaraguan-microfinance-crunch-reiterates-six-point-agenda-for-?recalibration?-of-industry-wor/

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