Yes, microfinancing, Grameen and all that jazz. But it is not enough. Sometimes too much attention is paid to the model of microfinancing. It is really very useful, but simply insufficient. The developing countries need much, much more than that.

Diverse financial services are needed, and fast. The map says it all – up to 80% of the poor do not have any access to formal or semi-formal financial services. But the Grameen model of 3-month deposits and credits will not suffice. Try setting up a factory on 3-month credits – it simply doesn’t work. Businesses in developing countries need long-term financing solutions that can allow them to start building their own capital base.

One important part of the solution is again education. If we can develop financial literacy (pdf), we stand a greater chance of empowering consumers to take action to improve their financial well-being.

We also need the development of public institutions in these countries in charge of financial market regulation and supervision that are up to the task. The prize is significant – capital in developing countries will be able to stay there, avoiding fast cash outflows that damage economic prospects.

The end result will be important for developed countries, too. We will be able to escape the “global savings glut” that has pumped up asset prices in the US and the EU.

Mobile banking (pdf) is an important first step. Add to that the establishment of development banks and affordable insurance (pdf). Debt markets are also important. But venture capital, equity funds, institutional investors – if backed by strong property rights – are out there, too. And as we very well know, developing countries have much to offer to a savvy investor.