Technology Review has an article in this month’s issue – Upwardly Mobile – describing how banking is being brought to rural India.  A lot of it was stuff I’d heard before; basically payments via cellphones (it’s been done in the Phillipines for a while).  What was fascinating was this:

These women live in a village that is seven kilometers from the nearest bank.  However, there’s a bank in that town that trusts a local woman (she’s the government’s representative for aid work) and has given her a special machine to extend banking to the village.  The way it works is like this:

• She has a strong box where she stores money from people in the village
• When people want to deposit or withdraw money they sign into a special machine via their fingerprint
• The machine uses the cellphone network to send a message to the bank’s central computer
• The cash is issued from the strongbox and the user gets a receipt

The system isn’t perfect (what happens if everyone wants to withdraw at once?), but it solves the greatest need of the villagers: the ability to store sums of money for short periods of time.  I thought it a very elegant solution; read the article to get an understanding of the impact this could have if it is scaled up across the entire country.