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NextGen Mobile Wallets: The Slim Billfolds May Prove More Lucrative

Posted on by Parul Tandon

Mobile wallets are often discussed, and often misunderstood, as the new way to think about payments and banking services-for both rich and poor. Mobile phones may be the only technology that is equally interesting to both ends of the economic spectrum right now.

Mobile wallets are no different from any other aspect of financial inclusion .The dominant player is still usually the bank. Nevertheless, seamless cooperation amongst all players matters more for m-wallets than most inclusion efforts. And two recent announcements-a Google-Citibank-First Data collaboration and Square, a new m-wallet led by Twitter’s founder Jack Dorsey-augur well for both low-income customers and retailers around the world without credit-card terminals, electronic cash-registers, and other expensive POS devices.

Sustainability of BC Network Managers (BCNMs) in India – How are BCNMs Paid?

Posted on by MSC

“There have been various studies carried out on international branchless banking commission structures highlighting the benefits and drawbacks of different pricing methods for the end user/customer, and the importance of these for adoption.

However in the case of bank-led branchless banking operations, the agent network managers (Business Correspondent Network Managers – BCNMs in India) doing the heavy operational lifting in the field, are often forgotten when it comes to commissions and sustainability. This Note examines the different product revenue drivers based on how banks remunerate BCNMs, provides an overview on different commission calculation methods adopted by banks, and analyses different scenarios related to revenue maximisation.”

Branchless Banking Update: Should We Bank on Phones or the Post?

Posted on by Parul Tandon

The term “branchless banking” may no longer be the most accurate way to describe what is currently going on in financial inclusion and microfinance. Are banks and branches even the two most important components?

For the past five-six years, most efforts to move money via mobile phones or point-of-sale (POS) terminals have required full bank participation, or at least bank partnership and oversight. Reasons include deposit insurance, customer and payment authentication, fraud control, G2P government disbursements, and the actual issuing of money. This note discusses these issues and concludes that for the present, in answer is yes: a full banking license and a safe place in which to conduct banking business will remain necessary for full financial inclusion to succeed.

The Business Case for Branchless Banking: What’s Missing?

Posted on by Parul Tandon

We are in the process of reinventing how these people send and receive money in remote locations, how they pay bills and loans. How they save and insure against emergencies, and for increasing numbers, how they enjoy greater freedom and control over their financial future.

The dilemma is how to make all these new ways of banking—by mobile phone, via card readers and enhanced ATMs, and with third-party agents who act on behalf of branch staff—either profitable or at least sustainable. Every other industry has had to revise how they make money in new markets with new technology. Banking may finally be forced to as well. There may be no traditional “business case” for financial inclusion. The scope and needs of these customers are too different. This reality may ultimately persuade banks to share risks, and rewards, with MNOs and—watch this space—the post office, global consumer brands, and technology service providers. Each brings new value and possible solutions that banks alone cannot solve.

BancoSol: How to Become a Leader in Deposit Mobilization Part 4

Posted on by MSC

In this video series-4, Kurt Koenigsfest, CEO of BancoSol, Bolivia, talks about the challenges they faced in the beginning. He mentions liquidity was a major issue. So, to promote savings the bank chose a mix of staff from both savings and lending background. He further describes the four key success factors that are critically important for any MFI that wants to engage in savings mobilisation. He talks about BancoSol’s experience with introducing a savings-based organisational culture and how appropriate incentives are helping staff to focus on savings.

Failures in Microfinance Lessons Learned 2

Posted on by MSC

“In this video series-2 Alex Silva, a microfinance pioneer, explain in detail the major reasons for the failure of microfinance institutions – an important topic that – so far- has not been talked about. Without doubt, practitioners from around the world stand to benefit from this seminal study of Latin American MFIs. Explaining these failings, Alex talks about the methodological flaws in the credit technology. He says many times microfinance entrants particularly bank mistakenly assume microfinance market is similar to the other areas they are operating.

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