Application of Information and Communications Technology in MFIs: Evidence from Bangladesh

Abstract

This study aims to evaluate the utilization pattern of ICT services by Bangladeshi microfinance institutions (MFIs). In so doing, this exploratory study interviews the staff of 10 prominent MFIs to underscore the ICT usage pattern of the organizations. The questions focused on the usage pattern of seven aspects of digital services such as website, ATM, e-cards and mobile financial services (MFS), smartphone use, MIS, customized software for different departments, and electronic mail and file management system. The results reveal that all the organizations maintain websites and use smartphones for internal and external communications, while none incorporated the services of ATM, debit, or credit cards. Moreover, it finds that only 20 percent of the MFIs included MFS to facilitate transactions and an identical proportion of institutions have electronic mail and e-file management services for their office management. It also claims that employing management information systems (MIS) and using customized software accounts for 20% and 40%, respectively. Therefore, policymakers and microfinance organization should take the necessary steps to foster the use of digital services in the business process so that costs can be minimized to attain the principles of outreach and sustainability.