The ambition to reach full global financial inclusion requires that we address the challenge of delivering appropriate and affordable financial services to an estimated 2.5 billion unbanked individuals globally. One response to this challenge has involved the design of products such as microloans, low balance savings accounts, micro-insurance, and mobile money transfer that are specifically tailored to meet the needs of the often excluded low-income mass market. Delivering these products and services on a large scale, however, cannot be achieved without accessible channels that lower the cost of service and increase reach.
Alternative delivery channels, defined as those channels that expand the reach of services beyond the traditional bank branch channel, have emerged as a result of innovations in information and communication technology and a shift in consumer expectations. ADCs are transformative in nature, accommodating the demand for access to financial services “anytime, anywhere, anyhow”. They rely heavily on information and communication systems and devices ranging from ATMs to mobile phones, all of which enable the instant transmission of financial and non-financial information between the customer and financial services providers. New technologies increase efficiency through automation, reduce operational costs, and improve service quality by cutting down on waiting times and offering more convenient access and reduced cost to the end-consumer.