Financial Inclusion and the role of Mobile Banking in Colombia: Developments and Potential

This paper studies the recent experiences in the regulatory field with respect to mobile banking in Colombia. It also explores the potential for greater development of these programs with an objective of achieving a higher level of financial inclusion in the country. The research for this paper is based on microdata analysis and it covers the following sections in detail:

• Current situation of financial inclusion in the country with a focus on financial depth and the services provided;
• Outline of the country’s strategy in terms of financial inclusion and the role of electronic channels in achieving the same;
• Regulatory changes aimed at encouraging the design of low-cost financial products;
• Role of banking correspondents in promoting financial inclusion;
• Mobile banking products that are currently available in the country;
• Discussion of the mobile telephony market with a focus on usage, operators, and other technological and market aspects;
• Estimate of the total potential demand for mobile banking in terms of mobile telephony cover;
• Description of the demand characteristics of potential banking customers and the relation between this demand and mobile banking development;
• Recommendations for the further growth of mobile banking in the country.