Improved technologies help credit providers

Fortunately, Beetar points out, improved technologies such as credit scoring and decision support automation, coupled with access to credit history information, may help to enhance credit providers' ability to extend credit faster to a larger number of people, at a lower cost. International Finance Corporation statistics show that less than a quarter of developing countries' populations have access to formal financial products, in comparison with as much as 90% in developed countries, Beetar says, adding that where there is an absence of formal credit information sharing, as there is in many emerging markets, significantly fewer loans are made.

Beetar points out that improved credit technologies allow credit providers to reduce subjective lending decisions and instead make use of objective and automated processes. "Such processes enable them to deliver credit products at significantly lower risk, reduced costs and, consequently, expand credit offerings to larger segments of the population," she says.

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