Prescriptions for effectively expanding financial services to the poor

• First, trust is an important reason that people do not use current banking services. Providing stronger consumer protection through tighter regulation and deposit insurance could be very important. 
• Second, many people are uninformed about banking options (in part because they have little or no experience with them). Better marketing from the banks themselves might be warranted. 
• Finally, more attention should be paid to the types of products that banks provide. While basic savings accounts do appear to be useful to a minority, more sophisticated products might be necessary for others (just as they are for many people in developed countries). For example, many people in Kenya save to deal with health emergencies, which are very common. For them, putting money into a bank that does not offer withdrawal services at night or on weekends and that has big withdrawal fees might not be very attractive. Similarly, people whose income is seasonal (such as farmers, who make up the great majority of the rural poor in Sub-Saharan Africa) might benefit from products that provide stronger incentives to save as soon as they have money.

That is from the new paper "Challenges in Banking the Rural Poor: Evidence from Kenya's Western Province" by Dupas et al., (February 2012).