Over the December holidays, I was visiting family in India, and despite everything you read about rapid economic development and the expanding middle class, the poverty so many people experience there is still striking.  However, the poverty I saw this time looked very different than what I’ve seen in previous trips.  People still live in flimsy shacks, but now they have televisions in those shacks.  In the big cities, mobile phones are everywhere.  In the past, large populations of the “unbankable” seemed completely out of the reach of traditionally structured financial institutions.  These days, in countries like India, large bands of the population can be served through channels that were never an option before, like the mobile phone.  

I also recently wrote a whitepaper about environmentally sustainable operations in financial services (shameless plug: you can read this paper on the Council’s web site here).  This exercise got me thinking about a number of ways corporations, and financial services institutions in particular, can “do well by doing good”.  There is clearly an opportunity to reach new customers in rapidly developing countries, and I suspect it is thus far relatively untapped.

Microcredit is clearly a successful means to provide financial products and services to the under-banked or previously un-banked, and its benefits, particularly in the empowerment of women in rural areas of the developing world, is remarkable.  The decision to offer these kinds of products and services may not technically fall under Operations’ domain, but supporting their delivery certainly does.

So what I am wondering is this: how can global financial institutions leverage their operational knowledge and expertise to serve the growing needs of the lower and lower-middle classes in emerging markets?  Expanding into these markets does not necessarily require Operations to overhaul and retool their processes.  More moderate changes, like offering a broader range of mobile banking services or beefing up processing for payments made directly at a merchant site can be made relatively inexpensively, and will open up a whole new pool of potential customers that would surely benefit from banking services.

This leaves me wondering something else: if changes can be made relatively inexpensively to serve the under-banked, AND there’s a demand, why aren’t more institutions taking advantage of this opportunity?