The recent publication of the memoires from the savings colloquium organized by the ProSavings Program in November 2014 led me to reflect on several issues. For instance, even though inclusive savings experiences have been implemented in several different parts of the region, we find that people who live in remote locations continue to face prohibitive costs in traveling to points of service to make deposits and thus achieve their savings goals. While the ProSavings Program has contributed toward motivating conditional transfer beneficiaries to save in a formal way - something this segment rarely did before- I wonder: what is the solution for those people who still find formal savings extremely costly?
CACPE Pastaza, a savings and credit cooperative in Ecuador, has been able to overcome this distance barrier, reaching even people residing in the most remote locations. The cooperative has done so by innovating in the way it offers its savings and credit products to the base of the pyramid. The cooperative’s officers visit clients at their homes or businesses to collect their deposits or credit payments, relying on the use of mobile technologies and charging an additional fee for the service. Upon completing a transaction, an officer presents client with receipt, generating trust as well. The software they use allows them to register transactions offline, as remote places may lack connectivity. As soon as the software receives a wireless signal again, it immediately uploads the information.
This “door-to-door” mechanism not only makes it easier for this underserved segment to use products, but also improves contact with the client, a key element of financial inclusion. This way, the cooperative’s officers collect the right information from the client and in turn, the client has the certainty that all transactions are being conducted directly with the entity, and he or she can resolve any issue or doubt in person with the officer, rather than through remote and automated channels.
However, this method doesn’t always work. It depends on each country’s regulatory environment and security issues. This is why, despite achieving considerable progress, financial inclusion still faces important challenges such as developing channels that bridge the gap between financial institutions and clients living in remote areas.
Do you think this model would work in your country?