Presentation for Hanson Wade "TECHNOLOGY INNOVATION FOR BANKS IN GROWTH ECONOMIES" -- 30 November 2011, London, UK

1. Banking and
Infrastructure in
Developing
Financial Services
Markets
A few slides on recent challenges in a few developing
markets, showcase of a few Rabo Development partner
banks.
Dan Armstrong
Takashi Mobile, 30 November 2011

2. Distribution as a Customer Acquisition Tool
Banked Customers
Time

3. Distribution : Banking and Banking Usage Trends
Alternative
Traditional
Physical Virtual

4. Rabo Development
 Rabobank Development is a
division of Rabobank
International, one of the world‟s
largest food/agri-banks
• Wholesale banking in 48 countries,
59.000 Rabobank employees
• AAA status as a retail bank, but focused
on rural/retail and agri-banking
 Rabo Development
partners/takes minority equity in
banks in developing countries
that match this historical profile
and skillsets.
 In addition to support in
food/agri- and basic banking
services, Rabo Development also
supports partners with brick-and-
mortar branch network
strategies, channels/automation
projects (mobile, ATM, internet),
banking products, fraud and in-
country personnel.

5. Rabobank World-Wide
Key
Rabobank Group Rabo Development
 48 countries, 59.000 employees Rabo International – Retail & Wholesale  Partner Banks: Brazil, Paraguay, Zambia,
Tanzania, Rwanda, Mozambique, China
 Robeco, Sarasin, Orbay, Obvion, Interpolis, Rabo International - Wholesale
Lage Landen, Athlon , etc.  Projects: Egypt, Malaysia, Vietnam,
RIAS & Rabo Development Kazakhstan, Pakistan, Ukraine, Malawi, etc.
 Main focus on food and agri-banking,
cooperative banking, and retail Rabobank Foundation

9. Banking in Harsh Environments
 Bringing compute resources and
solutions to banks in remote
locations with limited
infrastructure is a major
challenge:
• Fixed line internet connectivity (fibre,
WiMax) and, if available, huge cost
• Mobile internet connectivity
(GSM/HSDPA, GPRS/EDGE, WCDMA,
etc.)
• Power (lack of power at all, or lack of
stable power and/or UPS)
• Weather conditions (humidity, flooding,
sun exposure, lack of closed buildings
and server environments)
• Environmental conditions (dust,
exponentially higher maintenance
cycles)
• Security of computing platforms (theft,
transport, as well as e.g. stolen cooper
phone wire for other purposes like
jewelry)
• IT skills (system set-up, monitoring,
maintenance, usage of computers)
• Literacy

10. Generating Successful Formulas
Currently has /
uses another
financial product Too poor
Redistribution
Zone
Target / Does not have Excluded by design
Addressable access to the
Market product
Excluded by
default Development
Zone
Does not have / use
a financial product
Does not want
the product
Has access to the
product, but does
not use it Potential users
Enablement
Zone
Based on: http://www.bankablefrontier.com/assets/pdfs/access-frontier-as-tool.pdf

11. Zanaco
 40+ years of success, growth
and stability, successful
expansions, privatisation and
IPO
 450.000 customers, 1.200
employees, 50 branches
 Year-on-year profitability, K3 bln
in assets, mature risk
management regime. Healthy
account portfolio including:
• Retail: account services, personal
loans, e-banking, Xapit, remittances,
cash services
• Corporate: credit facilities, e-banking,
cash services, treasury and
investments, trade services
 Transformation to modern
banking tools: 100+ ATMs,
internet banking, mobile banking

12. Xapit Instant Banking
 Mobile Banking: Launched in
late 2008, USSD mobile
banking
• 250.000+ customers to-date
• 20+ bill payment partners, prepaid
airtime, etc., 21 transactions per
month
 Light Account: Also, Xapit
„account‟ = welcome pack +
mobile banking + ATM card
 DSA: Sign-up for an account *444#
and get mobile banking and a
VISA debit card in 5 minutes.
 Agency Banking: 123
ZamPost agency locations
 Truck Banking: Zanaco
mobile banking vehicles

13. FMB Fast Account
 First Merchant Bank (Malawi)
• 19 branches, corporate and retail
banking, 600 employees, growing
strongly
• 1/11 commercial banks in Malawi
 FMB Mobile / FMB Fast
Account
• Launched summer of 2010,
50.000+ customers to-date
• Successful to-date – packaging of
ATM card, bank account and
mobile banking functionality
• *** Includes immediate (small)
balance on customers’ account,
facilitating usage of the new
product

14. Case Study: NMB Tanzania
 NMB: National Microfinance
Bank Ltd.
• Also by-far the largest bank in
Tanzania
• 1.9 mln customers: regular
Tanzanians, all teachers, army, etc.
• ATMs in place (400+), most
customers have ATM cards
• 150 connected branches (100%)
 However, as a former
government bank:
• Must handle bill payments, salary
dispersal and non-customer
transactions
• Major queue problems

18. NMB mobile – mobile banking
 Dial *155*66# to access
 Features:
• Balance Inquiry
• Mini-Statement NMB mobile
1. Balance Enquiry
• Money transfers to any NMB account 2. Mini-Statement
3. Money Transfer
• Tanesco Luku Prepaid Electricity Purchase 4. Prepaid Services
5. Other Services
• Vodacom and ZAIN Prepaid Airtime Top-Up 6. Help
• NMB Services like ATM card block, settings
 No need to fill-in forms or visit an NMB
branch to sign-up, simply dial
*155*66*123#
 NMB mobile:
• Launched in August 2009
• 550.000+ active customers to-date
• All mobile networks, 100% nation-wide coverage
• SMS Alerts to 220.000 customers monthly

19. BPR Rwanda
 BPR (Banque Populaire du
Rwanda) is by far the largest
bank in Rwanda
• “Bank of the people” with roots in
cooperative and food/agri-banking
(>85% of Rwandans are farmers)
• 1,3 mln accounts (8x larger than the
second largest bank)
 In 2011, 47/191 BPR branch
banks were automated:
• Around 150 locations use paper-and-
pencil ledgers
• Staff may have no previous
experience with computers
• Fraud and information integrity are
problems.
• Customers can only bank at one bank
location.

20. BPR Mobile Banking
 “Project Columbus”
• Automating all 191 branches in 14
months
• Mobile internet (incl. USB modems,
laptops)
• Data migration, training of staff and
customers, card distribution
 New BPR E-Channels
• BPR Mobile Banking
(launched 09/2010, 110.000+ customers
to-date)
• BPR SMS Alerts
• BPR ATM Cards
• BPR QuickCash ATMs
• BPR Call Centre

21. BPR “Quickcash” ATMs
 Quickcash and ATM Cards
• 100 BPR ATMs online in 2011 throughout
Rwanda (donated by local Rabobanks)
• Increased ATM usage through new
marketing and promotions, usability
campaigns and POS roll-out
 New E-Banking Call Centre
• BPR call centre successful operating,
incl. ACD/call queue system
• Inbound and outbound calling to improve
usage, sign-ups and customer
satisfaction
• 650-1.000 calls per day, service level is
85%+

22. BPR Mobile Banking
Mobile Banking
1. Balance Inquiry
2. Mini-Statement
3. Money Transfer (BPR Accounts)
4. Prepaid Airtime
• MTN
• Tigo (pending)
5. Bill Payments
• RECO Prepaid Electricity
• StarTimes Africa TV
• DStv
• MTN Postpaid Bill
• Tigo Postpaid Bill (pending)
6. Bank Services
• Change BPR Mobile Banking PIN
• Change Language
• Order Cheque Book
7. Help

23. BPR Mobile Road Shows & Sign-up Success

24. BPR Mobile Road Shows & Sign-up Success

25. BPR: Simbuka
 Creating awareness of
technology and it‟s benefits for
Rwandans
 Automatically include new
technologies in new account
packages.
 Bring older (loyal) customers
along with the launch of new
services.

26. Challenges in Rwanda, Tanzania and Elsewhere
 Utilities  Costs
• high-quality power • connectivity (VSAT, 2G/3G, land
• paved roads lines)
• generator electricity only option in
 Environmental conditions some remote locations (costly)
• heat • high-quality solar still expensive
• humidity • but GPRS is being widely available
• dirt and can be a cheap and effective
solution – both for connectivity and
 Knowledge for electricity
• project management  Cultural Acceptance
• branches as ambassadors • technology acceptance
• trained technicians • trust
• maintenance and support personnel • usability
 Equipment • PIN/2FA
• spare parts
• local hardware/software licenses

28. Thank You!
Dan Armstrong, +31652085071 www.rabobank.nl
dan.armstrong@takashimobile.com www.rabobank.com