A new report released examines the growing use and effectiveness of innovative technology, such as smart cards and biometrics, in microfinance initiatives. Banks in India and Indonesia are actively growing their microfinance operations. Indonesia’s Danamon bank and India’s ICICI bank are relying on biometric and smart card technologies to alleviate the high cost of microfinance administration as well as the expansion of microfinance distribution points. Biometric authentication systems are particularly useful in areas with low literacy rates. Customers no longer have to rely upon signatures or filling out documents – they can simply provide their fingerprints to authenticate themselves and access their accounts through specialized biometric teller machines (BTMs). In addition to this, smart cards are used to track customer interactions to build real-time credit histories and bolster know-your-customer initiatives. Ultimately, the use of biometric and smart card technology makes it easier for the masses to access financial services.
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