The digitization of value chain finance—financial services that flow to or through any point in a value chain—is changing the way smallholders access the financial tools necessary to invest in their farms, manage risk, and transact with markets. CGAP explores opportunities and emerging models in digital value chain finance.
This Brief aims to provide national and global policy makers with a clear picture of the rapid development of digital financial services for the poor and the need for their attention and informed understanding.
Digital financial services (DFS) have grown considerably in emerging markets and developing economies, where they are instrumental for financial inclusion. DFS supervision needs to ensure that this expansion happens in a way that facilitates sustained, healthy financial inclusion.
Mobile financial services (MFS) have rapidly become a conduit for fraud and other criminal activity. Various fraud types have been noted in key MFS markets, including consumer-facing fraud from agents and third parties and fraud perpetrated against agents.
Last year, peer-to-peer (P2P) lending in China surpassed the US$100 billion threshold and confirmed China as the world’s largest P2P lending market, leaving North America a distant second. This tremendous growth was driven by a mix of circumstances.