What Maggi is to Nestle, Lifebuoy is to HUL, Alto is to Maruti and Horlicks is to GSK, perhaps “Tatkal” is to Eko. Ever since this direct deposit product was launched in August 2010 by Eko, it has emerged as the flagship product for this Delhi based business correspondent (BC) and technical service provider (TSP), providing technology for m-banking and agent based financial inclusion services.
Blog
Measuring Willingness to Pay
This Note presents the development and the implementation of an innovative qualitative research tool directed at determining the level of ‘Willingness To Pay’ (WTP) for BC services. The WTP tool has been designed to allow stakeholders to understand how low-income households think about pricing and cost. It is also an effective way to estimate what potential customers of BC services would be willing to pay for the services. The WTP tool helped to elicit some interesting results on the potential of charging ‘reasonable fees’ from potential BC customers.
Do the M-PESA Rails Contribute to Financial Inclusion?
A substantial proportion of the Kenyan population is using M-PESA as an addition to bank savings accounts, and less frequently, as a full-scale substitute. The worry among financial inclusion proponents and banks is that poor people will use M-PESA as a substitute for formal institutions. The Note examines progress towards financial inclusion in Kenya, and concludes that while M-PESA’s rails offer the potential, Kenya may yet have to wait to realise comprehensive, commercially sound, affordable and effective financial inclusion.
Clients’ Willingness to Pay “Reasonable Fee” for BC Services
This Note discusses whether end customers are willing to pay for financial services delivered by Business Correspondents, and if yes, how much are they willing to pay. It concludes that the majority of customers are willing to pay a fee for a convenient banking facility close to their homes. The service, however, has to offer a range of products suiting to their needs. The note gives insight into factors and mechanisms that could guide the decision on the fee to be charged. It provides a backdrop for service providers to start with what can be termed as a ‘reasonable’ fee; and once again, clearly highlights the importance of listening to clients.
What Do Clients Want in E/M-Banking Agents?
This Note describes clients’ preferences for desired agent profiles in India, and looks at how this data could be used when selecting agents. It concludes that agent selection must consider many aspects key to the viability of the business, such as the capacity to scale up and the ability to manage cash. However, client preferences for agent attributes are perhaps more important than other considerations, since these will be one of the main factors driving transactions. Organisations wanting to adopt agency banking models should take cognisance of this and exercise adequate due diligence in identifying key characteristics that clients desire and selecting agents according to those traits.
Riding the M-PESA Rails: Advantages & Disadvantages
By riding on M-PESA rails, most banks, MFIs and Deposit Taking Microfinance Programs (DTMs) are looking for cost reduction, increased staff efficiency and convenience of customers, which ultimately should lead to more deposits/transactions. This Note examines if, how and where financial institutions are realising the potential of M-PESA to make their systems more efficient and their products more accessible. It concludes that financial institutions that have agreements with M-PESA are not heavily promoting the opportunity, despite the potential benefits. They are aware of the issues faced by customers as well as the back-end challenges of reconciliation and so on, and are thus cautious about large-scale rollout.