Implementation of Information and Communications Technologies for Financial Inclusion in Programs to Alleviate Poverty in Brazil, Colombia and Mexico

Implementation of Information and Communications Technologies for Financial Inclusion in Programs to Alleviate Poverty in Brazil, Colombia and Mexico

Judith Mariscal (Centro de Investigación y Docencia Económicas, Mexico) and César Rentería (Centro de Investigación y Docencia Económicas, Mexico)
DOI: 10.4018/978-1-4666-4173-0.ch006
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The main objective of this chapter is to analyze innovative ICT implementation on CTP in three countries in the region: Bolsa Familia (Brazil), Oportunidades (Mexico) and Familias en Acción (Colombia). These three countries are implementing pilot programs that include ITC. These experiences may important insights for future successful implementation of ICT for CTP in other countries.
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1. Introduction

Information and communications technologies (ICTs) have become a strategic focus in countries’ development plans. Ensuring that the majority of the population has access to ICT services has become a fundamental public policy objective for both economic and social reasons. In terms of the economy, various studies document how ICTs increase productivity and contribute to economic growth by making the adoption of more efficient business processes possible and maximizing the effective use of resources (Katz, 2009; Qiang & Rossotto, 2009; Karner & Onyeji, 2007). They also contribute to speeding up innovation through the introduction of new applications and services (such as new varieties of commerce and financial intermediation).

In terms of social impact, various studies have identified the positive effect of the adoption of mobile telephony by the poorest sections of the population (Horst & Miller, 2005; Bar et al., 2007; Ling, 2008). The poorest sections of the population generally operate within the informal sector and survive with high transaction costs. There is also a growing literature documenting the role of ICTs as tools with productive uses, for finding employment, strengthening small businesses and contributing to the integration of the inhabitants of remote areas (Waverman et al., 2001; Galperin, 2005; DIRSI, 2007; LIRNE, 2006; Jackson, 2008).

This chapter analyzes three cases where e-government solutions have been implemented to strengthen programs designed to alleviate poverty. Additionally, these solutions aim to endow beneficiaries with additional capacities through financial inclusion and technology adoption. Even if it is still early to draw conclusions, the paper offers an exploration and an analysis of the key elements to provide the reader with valuable lessons regarding opportunity areas for e-government implementation in poverty alleviation programs. The studied cases reveal critical strategies for successful administration of similar interventions.

Common to the cases studied in this work is the two-fold benefit from using ICT’s. The main objective is to make poverty alleviation policies more efficient and effective through the implementation of ICT’s. In addition, considering that one of the characteristics of the conditional transfer programs (CTP’s) lies in its capacity to incorporate financial inclusion strategies in daily processes, ICT’s can also be used as a tool to promote financial inclusion through CTP’s natural functions, as an additional objective. A distinction must be made on the fact that ICT implementation for CTP’s does not serve as a public policy and that the beneficiaries technological adoption due to the programs payoffs is a consequential benefit of the financial inclusion strategies and not an established goal itself.

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