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World Banks seeks to bring banking to rural Mongolia
Real estate news By Mongolia Web News
Wednesday, 19 September 2007
Officials of the World Bank are studying ways to set up small banking stations in rural Mongolia to assist people who normally do not have access to banks. Working through CGAP, a global resource center for the microfinance industry housed at the World Bank, strategies are being considered to bring banking to more than two billion people throughout the world who live in areas where no banks are available.
In Mongolia, CGAP officials are considering setting up small banking stations inside rural post offices or stores in which local people could set up secure bank accounts. These small banking stations would be tied into the facilities of larger banks throughout the country.
“What’s innovative about this is that you piggy-back off existing infrastructure – the local pharmacy, supermarket, or post office. That means you can reduce set-up and operating costs, reaching further into remote areas where typically transaction volumes are too low for a traditional bank branch to pay for its operation,” says Hannah Siedek, a microfinance analyst. “The tricky part is that banks have to understand how to set this up internally and recruit and manage banking agents. Adapting products for these rural customers and financial education is crucial, as well.”
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