BASSETERRE, St. Kitts – THE Multilateral Investment Fund (MIF) of the Inter-American Development Bank (IDB) has agreed to provide US $3.95 million in support of technology solutions that would improve access to the Caribbean’s financial services.
According to a statement issued by the bank, the money would be used toward a series of projects that directly increase access to financial services in Latin America and the Caribbean.
Projects will be designed and implemented by microfinance institutions and would be geared toward reducing operational costs or helping to deliver new financial products. As much as US $10 million has been budgeted for the overall programme to eventually be implemented.
The programme will help microfinance institutions increase their reach and stimulate the development of financial products for low income communities in Latin America and the Caribbean.
“Institutions will initially be asked to submit project ideas. The selected institutions will get support from the program to develop a technology strategy and a project proposal. A second selection process will determine which of the proposals will be implemented,” the release stated.
Selections are expected to begin in early 2010, and would be based on a project’s innovation and capacity to achieve measurable results.
According to MIF General Manager Julie Katzman, the goal of the overall programme is to provide first-time access to credit for 250 000 small businesses or low income individuals.
“Technology can play a crucial role in extending the reach of financial services in the region,” she said.
“Technologies such as mobile banking or simpler banking software applications can help reduce costs and reach more people. We hope this program will stimulate new thinking on innovative solutions and uses of technology that help truly massify the reach of microfinance institutions,” she continued.
Proposals on the use of new technologies to expand access to financial services were tabled by microfinance institutions during an IDB Forum on Microenterprise held in Peru last week.
The IDB therefore launched the project using the feedback gathered during the workshop to help the MIF define the selection criteria required to meet the needs of the microfinance community.
Knowledge sharing is expected to be promoted through an online community portal where institutions can present and discuss ideas, submit their project proposals, and share their experience executing their projects.
