Mobile Microfinance-System Design

Mobile Microfinance-System Design

The Indian microfinance sector is characterized by a diversity of strategies, methodologies, organizations, partnerships and performance. In 2005, five leading Micro Finance Institutions (MFIs) from India ranked in the list of top 20 fastest growing MFIs in the world. Apart from regulatory and structuring challenges, the current system of microfinance in India faces the major challenge of increasing reach and overcoming the accessibility issues.
In this project we designed a novel system model to extend the use of mobile phones to microfinance services. The system model we proposed not only ensures better accessibility but also warrants better security and ease of transaction without compromising the trust of user.

We propose systems with post office as an actor which complements m-commerce for the monetary transactions. Like in all m-commerce activities, the major flow of capital will be in the form of Virtual Cash. Transactions take place by using a secured mobile application through which the transfer of virtual cash takes place. This strategy will help the field officer to focus more on talking to rural people to achieve financial inclusion of the rural masses while creating a new breed of local entrepreneurs. Also as post office has traditionally served as financial institution for Indian villagers, inclusion of post office in the system will enhance the trust.

This project involved in depth understanding of system design. We used UML to identify and represent the main actors in the system, to determine how they are related to each other, to identify the characteristics of each of them and to decide the inheritance of personal traits and characters. The project gave me an opportunity not only to explore UI design but also mobile technologies and system design.

Relevant Publications

Suyog Deshpande, K. Mayank (First two authors with equal contribution) Ityam Vasal (2009) “System design to extend usage of mobile phones for microfinance services in India” Proceedings of USID 2009 Bangalore, India.