Micro-financing & M-Commerce

Diamond Calara
100694721

Business has evolved greatly and changed the way our world runs; it is everywhere and has a large impact on everyone and everything. In relation to under-developed countries, business plays a role by introducing micro-financing initiatives. Micro-financing is banking to those who do not have enough funds to offer desirable collateral to be served by regular banks. Micro-financing is the system that offers financial services such as brining credit and savings to these individuals who do not have large incomes. Microfinance institutions are organizations that offer the financial services as mentioned, to low income populations. Resources are retrieved from the banks and other Financial Institutions then these monetary services and supports are provided for poor people that are unemployed, entrepreneurs or farmers who are not bankable (1). Some basic financial services offered are loans, savings, money transfer services and micro-insurance (2). We see this take into effect and how it is beneficial to the users or clients of micro-financing by how customers take out loans and repay them with high reliability also customers coming back for the services as repeat customers (3). M-commerce on the other hand can be disruptive in this process of assisting under-developed countries. M-commerce is the ability to use a wireless mobile device to perform financial transactions and make payments over the internet as well as delivering information (4). As we can see, the availability of a wireless mobile device with the accessibility of internet is necessary for M-commerce. If some micro-institutions were to take part incorporating this system, it can hinder the process of allowing full capability of clienteles within the micro-financing group of low income earners to have access to their services. A customer such as a farmer or an individual who does not have these sources of technology since they do not have enough funds available to them, would definitely hinder them from further acquiring any funds or services from an institution who uses this system. Micro-financing in turn is a highly potential stepping stool to give a head start and support for those who are striving to overcome financial difficulties. Although M-commerce is a great system that helps make business more time efficient and productive it does not in this case help micro-financing be more accessible to under-developed countries.

Work Cited 1. " T h e d e f i n i t i o n o f m i c r o f i n a n c e . " M i c r o f i n a n c e a n d m i c r o c r e d i t Principles of microfinance. N.p., 02062009. Web. 20 Feb 2011. <http://www.microfinanceinfo.com/the -definition-ofmicrofinance/>. 2. " W h a t I s M i c r o f i n a n c e ? . " C G A P A d v a n c i n g f i n a n c i a l a c c e s s f o r t h e world. CGAP: Consultative Group to Assist the Poor, 2011. Web. 20 Feb 2011. <http://www.cgap.org/p/site/c/template.rc/1.11.947/>. 3. " D o e s M i c r o f i n a n c e H e l p P o o r P e o p l e ? . " C G A P A d v a n c i n g f i n a n c i a l access for the world . CGAP: Consultative Group to Assist the Poor, 2011. Web. 20 Feb 2011. <http://www.cgap.org/p/site/c/template.rc/1.11.947/>. 4. M c C a b e , L a u r i e . " W h a t i s M o b i l e C o m m e r c e , a n d W h y S h o u l d Y o u Care?." Small Business Commuting.com (2011): 1. Web. 20 Feb 2011. <http://www.smallbusinesscomputing.com/news/article.php/3903176 /W hat -is-Mobile-Commerce-and-Wh y- Should -You-Care.htm>.