October 17, 2006	Tuesday	Ramazan 23, 1427

KARACHI, Oct 16: State Bank Governor Dr Shamshad Akhtar on Monday said that options were being explored to make financial services available to unbanked segments of the country and expressed the hope that the banking industry would learn lesson from experiences of the regional countries.

In her keynote address at a seminar on “Improving Access to Financial Services: Mobile Money Transfer and Beyond,” which was jointly organised by the SBP and Asian Development Bank (ADB) she stressed for greater access to credit for poor of the country.

“Building sustainable financial services system for poor is of critical interest and requires laying foundation for potentially profitable market and enterprises that can develop ways to reduce the costs and risks of serving them,” she emphasised.

She said that while encouraging e-banking and e-commerce, the central bank was now working closely with the banking industry to explore options for adoption of new technologies to reach under-banked areas with the objective of enhancing access to rural, agriculture and microfinance credit and to attract international remittances.

“In this respect, strategic alliances with overseas partners with special focus on technological compatibility are encouraged by SBP,” Dr Shamshad said.

She highlighted the importance of sharing regional experiences of strategic approaches, options and innovative connectivity models for rural and under-served areas.

She noted that developments in the financial industry and technology had been mutually reinforcing with developments in database management systems along with networking had encouraged virtual and electronic banking and commerce thereby facilitating an explosion of financial innovations.

The SBP governor said the banking industry had exploited different technologies to deliver financial services with the proliferation of automated teller machine (ATM) and point-of-sale (POS) network and devices.

She said the use of a mobile phone to conduct payment and banking transactions (m-banking) was at an early stage in a number of developing countries and was growing as mobile phone service providers were penetrating in developing markets and setting up the infrastructure.

“For improved coverage of mobile banking applications there is a need to develop proper sector regulation, effective institutional and commission arrangement sharing among retailers, clients and outlets that accept and sell cash and commission and to launch an aggressive marketing campaign that is geared for all types of users and service providers,” the she added.

In his opening remarks, Dr Peter Fedon, Country Director, ADB’s Pakistan Resident Mission stated that modern technology solutions hold much promise for increasing access to efficient and sustainable financial services and reaching clients in remote or under-serviced areas for continued economic growth.

Fedon stressed the importance of bringing in innovation and applying new technologies for improving operational efficiencies, and reducing transaction costs associated with delivery for financial services, such as worker remittances.

Additionally, infrastructure that supports delivery of financial services provides a channel for multiple other services such as education that can further bolster development and entrepreneurship in rural and remote areas, he said.

Speaking on experience of the Philippines in using technology for greater financial services outreach, Jose G. Vega of Globe Telecom explained about the G-Cash product and its social and economic impact on mobile money transfer to more than 10 million Filipino migrant workers all over the world and improved access of the un-banked population to microfinance services in the Philippines.

Allen Hammond of the World Resources Institute (WRI) discussed emerging technology models including: mobile wireless (cellular) networks; fixed wireless technology (WiFi, WiMax); and a new generation of satellite networks (VSAT) designed for data transmission.

In this respect, he demonstrated on how applications for financial services, agricultural services, and health services can be addressed using VSAT technology as done in a pilot project in rural Viet Nam.