The UK Department for International Development (DFID) has committed £8 million to a technology programme run by microfinance group CGAP designed to increase access to financial services for the poor.
CGAP, which is based at the World Bank, promotes the use of information and communication technologies (ICT), especially mobile phones, for financial services in the developing world.
The group's technology programme aims to help policymakers develop regulations that support effective use of mobile technologies for financial inclusion. It also wants to harness existing government payments and remittance flows to provide banking services and improve industry knowledge and practice in the areas of customers, agents, business models and regulatory frameworks.
Over the last six years the group has provided financing and technical advice to projects with more than a dozen providers in Asia, Africa and Latin America to develop innovative banking solutions, and conducted in-depth policy assessments of 13 countries.
Gareth Thomas, UK minister for development, says: "Giving people access to financial services can help them lift themselves out of poverty. I am therefore pleased that the DFID-supported Technology Program at CGAP will work to improve poor people's access to financial services such as payments, savings, loans, and insurance. The Program will also support the delivery of social protection payments in developing countries and make the transfer of international remittances cheaper and safer."
Last year DFID pledged £1.4 million to spur the development of biometric and mobile phone-based banking in emerging economies in Asia and Africa. The three-year UK-led project - dubbed Facilitating Access to Financial Services through Technology (Fast) - will explore the options for introducing 'branchless banking' in developing countries, such as Kenya, Tanzania, Pakistan, Nigeria, India, Bangladesh and Ghana.
The department has also provided funding to Vodafone which helped create M-Pesa in Kenya, which in three years has reached more than 8.5 million people with mobile money transfer.