Despite the large demand for financial services among people with low income, perceived risks associated with unstable earnings, lack of credit history and limited collateral deter business innovation in this sector. The World Bank states that 2 billion people do not use formal financial services and more than 50 percent of adults in the lowest-income households are “unbanked”. This is because conventional models and procedures used by formal financial services create barriers for low income households to set up bank accounts and access credit. Many mainstream financial institutions also perceive that providing these services can be high cost and low profit when traditional approaches are taken.