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Use and Management of Conventional ICT and Mobile Technology in Microfinance: A Bangladesh Perspective

Use and Management of Conventional ICT and Mobile Technology in Microfinance: A Bangladesh Perspective

Mohammad Badruddozza Mia (Open University, UK) and Magnus Ramage (Open University, UK)
Copyright: © 2015 |Pages: 15
DOI: 10.4018/978-1-4666-6268-1.ch038
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Abstract

Microfinance has been a significant means of reducing poverty since the mid-1970s. With the economic, social, and demographic characteristics, Bangladesh has been one of the countries where microfinance interventions are notable. In Bangladesh, hundreds of microfinance organisations have been implementing microfinance programs covering almost one-third of the rural population of the country. Studies show that the proper use of Information and Communication Technology (ICT) may help microfinance intervention in different ways. It may help increase operational performance, organisational upsizing, and poverty outreach, and decrease interest rate with many other organisational and social implications. This chapter looks into the Information Systems (IS) of microfinance of Bangladesh, the extent and intensity of the use of ICT, the factors that hinder the use of ICT in microfinance, the approaches to ICT management, and the emerging mobile technology-based operational model of microfinance and perceived implications of the changing landscape of ICT on this development program.
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Microfinance Sector And Use Of Ict

Although helping poor people through providing financial services used to be in the long past in different parts of the world (Seibel, 2003; Nath, 2004), the present movement of microfinance began after the liberation war of 1971 in Bangladesh, within the context of on-going poverty and undeveloped social circumstances, exacerbated by the war and post-war destruction (Choudury et el., 2009; Yunus and Joils, 1998). Since then the movement of alleviating poverty through providing financial services for the poor and involving them into a process of social development has been going on in the country. Presently, about 700 registered microfinance organizations are providing microfinance services covering 33 million active borrowers from 17, 400 outposts throughout the country (CDF and InM, 2011). Grameen Bank, BRAC and ASA are the major providers of microfinance of Bangladesh. PKSF is the apex funding body that provides wholesale funds to the microfinance organizations especially the medium and small sized organizations. Except for Grameen Bank, all other microfinance organizations of the country are regulated by newly formed Microcredit Regulatory Authority (MRA).

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