Innovations in microfinance have been ongoing since itsinception in the mid-seventies. Recently,however, a group of microfinance institutions worked with Hewlett-Packard and developed an innovative technology, then piloted it using 3 uniquemicrofinance business models. Thetechnology - the Remote Transaction System - dramatically reduces transactionscosts, fraud, and client/lender downtime using off-the-shelf handhelds andalready-available GSM network capacity. Thisinnovation, with its potential for broad-based application, could helpmicrofinance leapfrog from small-scale, donor-funded operations intocomprehensive financial systems serving developing communities around theworld.