FI Highlight: Nusenda Credit Union

September 1, 2015
/   Spotlight

While it is important for banks and credit unions to consider the needs of consumers, it’s also important for FIs to take employee needs into consideration as well. Michelle Dearholt, SVP of Human Resources at Nusenda...

Is a .bank Domain Right for Your Bank?

August 28, 2015
/   Voices

With the general availability of the .bank registry under way, more than 5,500 applications from over 2,200 banks have already taken place, according to fTLD Registry Services.

Can Smartphones Solve ATM Skimming

/   Insights

ATM skimming remains a big business for organized crime rings. According to a recent article in, card skimming accounted for more than $2 billion in losses. One new approach that banks are exploring...

Cause and Effect: If you build it, will they come?

July 23, 2014
/   Spotlight

Many financial institutions assume that digital banking is lucrative because the most valuable customers happen to bank online. While there is certainly a correlation between online bankers and higher profitability, quantitative evidence suggests that...

Fast Facts: Student Loans

January 22, 2013
/   Insights

The Financial Services Roundtable recently released another iteration of its Fast Facts, reliable, bullet-point research about issues facing the financial services industry. Topics span TARP, Dodd-Frank, insurance, lending, retirement savings and more.  Below are some updated Fast...

Intuit 2020 Report: The Future of Financial Services

April 11, 2011
/   Insights

Today, Intuit released the latest edition of the Intuit 2020 report, Intuit 2020 Report: The Future of Financial Services, which identifies and examines four key trend areas that will  transform the financial services industry...

The Top 10 Trends in the Digital Banking Industry

December 18, 2013
/   Spotlight

2014 is rapidly approaching and as the year wraps, the Digital Insight team has pulled together the top 10 trends in the digital banking industry based on data and trends from studying financial institutions....

Small Business: Perception vs. Reality

November 21, 2012
/   Insights

In the most recent election cycle, like most others before it, the one sector of the economy that got the most attention was small business.  This is the future, we were told by every...

Making Banking Fun: Gamification in Financial Services

August 5, 2013
/   Insights

Recently, the team sat in on American Banker’s webinar, “Gamification in Financial Services: Five Proven Ways to Get an Edge,” which shared how leading brands in financial services have applied gamification to reach...

Technology M&As: The Beats Go On

May 29, 2014
/   Insights

The ongoing fascination with Apple’s $3 billion purchase of Beats Electronics is entirely understandable, because it’s a cool story. However, it also says a lot about what’s going on between finance and tech.

What We’re Reading

May 5, 2011
/   Spotlight

Below are interesting stories the staff has been reading over the past week. What have you been reading? Let us know in the comments section below. Virtual Banking Worlds Provide Tangible Lessons American...

What We’re Reading: Thanksgiving Edition

November 22, 2012
/   Spotlight

Below are interesting stories the staff has been reading over the past week. What have you been reading? Let us know in the comments section below or Tweet @bankingdotcom. Mobile Thursday? Plans for Thanksgiving...

It’s all too easy to talk about payments in terms of convenience from the very narrow consumer perspective. It’s easier to tap and go with your contactless card than to use cash at a till, but is it really transforming lives?

In the developing world, however, the power of mobile banking and payments to radically improve the lives of people in poverty is something that deserves attention.

Financial inclusion

The Bill and Melinda Gates Foundation predicts mobile money will catalyst change across the poorest nations. This charity has for some time been making the case for spreading electronic payments globally to improve lives by increasing financial inclusion. Now, as part of a new report, it argues that mobile technology in particular will be key.

Taking the example of one East African nation, the Kenyan Financial Diaries is a project that highlights how people need to forgo medical care or take their children out of school because they don’t have enough cash. But it’s not just lack of assets, no meaningful financial inclusion ensures there is no way out.

“The reason poor people face these agonizing choices is not just that they don’t have enough assets,” says the charity. “They also don’t have access to a bank to help them use their assets effectively. If their savings are in the form of jewelry or livestock, for example, they can’t very well chip off tiny pieces to cover routine daily expenses.

The financial services they do use are “extremely inefficient” – hiding cash or buying commodities that lose value over time.

“When they send money to friends and relatives to help them through tough times, they either take a day off and deliver the cash themselves or trust someone else to do it for them. If they need to borrow money for an emergency, they have to pay usurious interest rates to a moneylender.”

As someone once said, it costs a lot of money to be poor: “Not having access to a range of cheap and easy financial services makes it much more difficult to be poor.”

Mobile transformation

However, the charity argues that digital banking will transform lives over the next 15 years and the key to this will be mobile.

People can already store money digitally on their phones and use them to make purchases. The example of M-Pesa in Kenya has been well documented as a great success. More schemes like this and more advanced solutions will come.

“By 2030, two billion people who don’t have a bank account today will be storing money and making payment with their phones. And by then, mobile money providers will be offering the full range of financial services, from interest-bearing savings accounts to credit to insurance,” says the Bill and Melinda Gates Foundation report.

Small margins, big effect

Part of the reason is a change in business model. The high cost of serving poor customers – infrastructure investment and so on – has been the major barrier. But most adults possess a mobile phone and providers are able to charge virtually nothing for processing a digital transaction.

“By making small commissions on millions and millions of transactions, mobile money providers can make a profit serving poor customers, just as brick-and-mortar banks do serving the wealthy,” says the charity. “Once these services get going, then there will be competitive innovation in offerings like special savings or credit plans related to farming or education.”


Of course hurdles remain; the mobile banking revolution won’t just happen by itself. For example, just 46 per cent of Bangladeshi women own a phone, compared to 76 per cent of men in the country.

And physical cash still remains king, which means it’s vital for there to be enough locations for people to convert their digital money into notes and back again. “Without this as an enabling factor, the digital economy can’t get started. Making sure that enough retail stores in every community provide this service allows the digital economy to bootstrap into the mainstream,” the report argues.


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James W. Gabberty

Gabberty is a professor of information systems at Pace University in New York City. An alumnus of the Massachusetts Institute of Technology and New York University Polytechnic Institute, he has served as an expert witness in telecommunication and information security at the federal and state levels and holds numerous certifications from SANS & ISACA.

Marisa Mann

Marisa Mann brings over 15 years of experience in consulting and financial services industries to the Solstice team, working on large scale enterprise initiatives across many technologies, including specializing in the digital space – Internet and mobile. Mann is passionate about mobile and the endless possibilities for the enterprise, delivering business value through strong brand recognition and driving to excellence in the consumer experience. Prior to Solstice, Mann worked at JP Morgan Chase, Diamond Management and Technology Consultants, Washington Mutual, Inc, and Accenture.

Zachary Ehrlich

25-year-old writer, and as a native San Franciscan, I am unreasonably loyal to Bank of America, if only for their superhero-like origin story, involving the 1906 earthquake and Italian fruit vendors.

Brad Strothkamp