1. Remittances for Development Opportunities and Limitations

2. Founded in 2003 by Atsumasa Tochisako, former General Rep. of the Bank of Tokyo-Mitsubishi in Washington, to support grassroots development in Latin America. The company offers a settlement platform for MFIs that combines efficient banking technology with treasury operations and allows MFIs to process transfers and other transactions and interact with the commercial banking system. Since June 2004, the platform is operated in a remittance pilot with 5 MFIs in El Salvador. Microfinance International Corp.

4. Opportunities Remittances outsize FDI, ODA and in many countries are the largest source of hard currency income. Channeled and processed appropriately, they can strengthen the financial sector in rural/poor areas, provide a source of capital and fuel grassroots economic development. Transfers can prove income for Remitters and Recipients, build credit worthiness, create savings and help build financial security in other ways.

5. Limitations Remittances are usually send when needed, and in consequence, mainly consumed. As private funds, they cannot easily be diverted to development projects. 60% of remitters are unbanked and often not able to provide appropriate documentation. 80% of recipients are unbanked. Remittances are mainly channeled outside the financial sector. Many commercial banks are not interested to offer services other than remittances to recipients. MFIs often do not have the infrastructure or operational capabilities to process remittances.

6. (Atsumasa Tochisako, Founder)

7. Our Solution

8. Based on COBIS and Microbanx, successful banking and Microfinance software. Offers MFIs online functionality for payment processing, transaction and customer administration, reconciliation, management of their funds and interaction with US banking system. Efficient centralized treasury services maximize float, allow overnight investment and ensure compliance monitoring (AML, CTF, OFAC). Internet-access, centrally operated hardware and simple licensing eliminates the need for MFIs to make upfront investments in hardware or software.

9. Designed to allow lending to smaller, rural MFIs that do not have easy access to secondary or development funding. Float generated from transaction processing will provide a pool of capital or function security to reduce cost of capital for MFIs. Knowledge generatde about MFIs from operating the settlement platform will reduce the need for costly Due Diligence while funds processed in settlement operations provide security assets.

10. One-stop shop offering remittances, check cashing, small loans, establishment of credit history, and financial education. Allows us to control service, ensure compliance and maximize float. Functions as a marketing channel for partnering MFIs and provides information on their services. Transfers are exclusively channeled through participating MFIs. May in the future bring US banks and Latin immigrants together.

11. Experiences from Pilot Remittances at Mi Pueblo shop have outgrown average remittance agents after 5 weeks. Salvadorians in Washington have shown to be very interested in Microfinance services here and there. Remittance float on average has been 35% of remittance volume. MFIs provide excellent customer service. Cross selling of other products has been successful (one MFI sold other products to 45% of recipients ). MFIs need support in handling of cash and technology.