Exploring the factors affecting the adoption of mobile financial services among the rural under-banked and its implications for micro-finance institutions
Abstract
Around two and half billion adults worldwide do not have a savings or credit account with
either a traditional (regulated bank) or alternative financial institution (such as a microfinance
institution). On the other hand, penetration of mobile technology had been substantial in the
past few years and is expected to increase in the future. Around one billion people in
emerging markets have a mobile phone but no access to banking services and it is said that by
2012 this population will reach 1.7 billion. Financial institutions, which have had difficulty
providing profitable services through traditional channels to poor clients, see mobile financial
services (MFS) as a form of 'branchless banking', which lowers the costs of serving
low-income customers. The main objective of this study was to determine the factors
affecting the adoption of MFS (including mobile banking and mobile payments) among the
rural under-banked population that would help the micro-finance institutions like credit
cooperative societies to reach to more people with better quality of services.
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