People without access to formal financial services number an estimated four billion, according to a study by the CGAP, an independent policy and research center housed at the World Bank and dedicated to advancing financial access for the world's poor.
For many of us in developed countries, mobile phones are generally used for non-life-sustaining purposes, like voice and text communication. But mobile phones transform lives for many in the world’s most vulnerable locations, by presenting a way to communicate regularly with family members for the first time. As Tatum Anderson of the BBC reported, “Almost 100 million Chinese migrant workers rely on mobile phones to talk to the families they have left behind in rural areas.”
in Africa, the poor working masses can now safely send money to their families back home. One would think that the best way for city workers to deliver a portion of their hard-earned money to family members back home is by hand, avoiding wire transfer charges. But in Zimbabwe, workers who seek employment in distant locations such as South Africa are faced with having to pay border crossing bribes at security checkpoints. Now they have a better way to transfer their earnings back home, by M-banking.
The World Bank believes that M-banking might help to serve about three billion people who are without access to financial services. The M-banking system would allow them to transfer money safely from their mobile phones to those of their families, and the receiving party would be able to redeem transferred amounts in cash from mobile airtime sellers.
"What ultimately gets people out of poverty, and prevents them from being vulnerable to crises, is when they have a nest egg to fall back on,” says Gautam Ivatury, former head of Technology at the CGAP.