Information and Communication Technology and Microfinance: Options for Mongolia

Microfinance has emerged as an effective poverty reduction tool by providing financial services to poor people marginalized by commercial financial institutions.

However, there are still millions of people in rural, remote areas who do not have access to financial resources. Recently many cases have shown that using new technology is effective in reaching the poor in a cost-effective way. Nevertheless, these technologies are recent developments and have been primarily experimented with in urban areas where the necessary infrastructure is available.

This paper focuses on the application of information and communication technology (ICT) for expanding microfinance services to rural remote areas. In particular, it explores four possible solutions for extending rural finance in remote areas of Mongolia. It reviews the ICT innovations in microfinance, examining the challenges facing rural finance in Mongolia, and the current strategy of XacBank, a leading microfinance institution.

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1. Pratyush Agarwal
   (posted 12 June 2009 / 03:20:06 PM)
   
   A very good paper! It recognizes and abridges the technological usage for the bank. But, It has not dealt on the possibilities of using land-line phones, a prevalent technology in rural areas.