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Phoning It In

For Erdene, a Mongolian livestock herder, going to the bank means riding his horse almost 19 miles to the nearest XacBank branch. By the time he conducts his transactions and rides home, he’s lost half a day. But his banking needs may soon be less taxing. XacBank plans to offer Erdene and other clients m-banking ...

For Erdene, a Mongolian livestock herder, going to the bank means riding his horse almost 19 miles to the nearest XacBank branch. By the time he conducts his transactions and rides home, he’s lost half a day. But his banking needs may soon be less taxing. XacBank plans to offer Erdene and other clients m-banking — deposit, withdrawal, and money transfer services conducted via text-messaging on mobile phones. Similar services are already popular elsewhere. For instance, when the government of Zambia recently needed to pay more than 150,000 demobilized soldiers scattered around the country, it decided to use Celpay, a Lusaka-based m-banking service. The technology is also popping up in Nigeria, the Philippines, and other countries with heavy remittance flows, because removing tellers and other third parties can cut the cost of those transfers by two thirds. It’s good news for Erdene — and his horse.

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