John owens, chemonics   maximizing efficiency to sustain a double bottom line
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  • What roles do MFI NGOs, Cooperatives, Banks, Telecos, and Donors play in supporting innovation to achieve a double bottom line?
  • Archipelago: 7,100 Islands Population: almost 95 million Rural Population: 50% Pop. In Poverty: 30% Over 600 Rural Banks Nationwide Over 2,100 branches Annual Remittances: $18 B # of Mobile Phones per 1,000 people: 910
  • The Rural Bankers Association of the Philippines - Microenterprise Access to Banking Services (RBAP-MABS) Program provides technical assistance and training to rural banks in microfinance best practices since 1997 with support from USAID. The program is designed to develop the capability of rural banks to profitably provide financial services (loans, deposits, insurance, money transfers and mobile banking) for microenterprise clients. In 2012, the RBAP-MABS program is now in its 15 th year. Although the funding for the MABS program from USAID will end this year, RBAP will continue the MABS program with support from the rural banking industry, private sector partners and support from donors. Ongoing initiatives and support from the International Labor Organization’s Microinsurance Innovation Facility funded by the Bill & Melinda Gates Foundation for microinsurance efforts will continue until 2013 as well as funding from Microfinance Opportunities with funding from MasterCard Foundation to support financial education in branchless banking will continue until 2013. It is now up to the industry to continue to grow and sustain this important service provided by RBAP to member rural banks. I look forward to coming back in 15 more years to celebrate both RBAP’s 75 th anniversary and the RBAP-MABS 30 th anniversary!
  • Today, rural banks are faced with a number of factors that affect their ability to expand their services. Markets are changing today more than ever before with new products and services and much greater access to information than ever before. Traditional and new players are now entering the market from all directions. New technologies provide banks and others with new ways to address market conditions. This is both a challenge and an opportunity for those who move quickly. New regulations are promoting greater financial inclusion than ever before.
  • Clients today are no longer satisfied with simple deposit and credit services but want access to new products and services including micro insurance, access to ATMs, cash cards, prepaid debit cards, mobile banking and other services.
  • New technologies are now offering opportunities not dreamed possible 5-10 years ago. SMS services, POS systems, cash cards, ATM cards, and prepaid debit cards. New social networking sites to reach and interact with clients are becoming increasingly important.
  • OBOs/MBOs can now accept deposits and is designed to fit the capacity and serve the needs of basic sectors. Features of Micro-Deposit includes: Minimum maintaining balance not exceeding P100 Not subject to dormancy charges Only for individual clients whose ADB balance does not exceed P15k No frills account to address to basic deposit account and increase savings consciousness to the low-income population.
  • Cash cards offered by banks such as BDO or ATM cards like the co-branded GCASH Rural Bank FaceCard are now providing greater access and significantly lower fees than ever before. Smart Money MasterCards offer the convenience of not only accessing ATMs but also paying in over 50,000 MasterCard POS merchants nationwide.
  • The BSP has opened the doors to partnering and offering banking services that can be promoted through third party agents. BPI has lost no time setting up kiosks in different areas to promote micro savings using the Easy Savers Plan that provides new customers with an instant ATM card. BanKO is also offering any business who wants to partner with them to become a partner outlet like the ones pictured here. Cheaper POS systems and liberal agent banking regulations in countries such as Brazil mean that most banking transactions take place in shops rather than going to a bank where you can pay bills and support deposits and withdrawals. By using a mobile wallet, BanKO is a good example of how this is also now taking place in the Philippines.
  • Social networking via SMS marketing or updates or sites such as Facebook and Twitter are changing the face of everything we do including where we shop and even where we bank.
  • Here is an example of one Cantilan bank’s Facebook site which it uses to stay in touch with customers and clients who work not only in the community but also overseas.
  • SMS banking services are also helping banks to reach out to clients in new and innovative ways and to “personalize” customer relationships in ways that were never before possible using basic software and a modem. For more information on RBAP-MABS partner, MyClick Technologies check out http://www.slideshare.net/MABSIV/crm-via-sms-1491074
  • I JUST CAME BACK FROM ATTENDING THE GSMA MOBILE WORLD CONGRESS WITH OVER 67,000 PARTICIPANTS. BY FAR, THE LARGEST CONFERENCE I HAVE ATTENDED AND I WAS IMPRESSED TO SEE THE PROGRESS OF THE INDUSTRY AND THE APPLICATIONS THAT WILL BE AVAILABLE SOON FOR ALL BANKS AND ALL PEOPLE. AS THE PRICE OF SMARTPHONES NOW FALL UNDER 5,000, WE SOON EXPECT TO SEE IN THE PHILIPPINES, PHP 2,000 ANDROID PHONES AND PHP 3,000-4,000 ANDROID TABLETS THAT WILL REVOLUNTIONIZE ACCESS TO BANKING SERVICES, PAYMENTS, AND COMMERCE. PHONES AND CHEAP TABLETS ARE BECOMING AND WILL REPLACE TRADITIONAL POINT OF SALE SYSTEMS. APPS WILL SOON BE WITHIN THE REACH OF MOST PEOPLE AND BANKS WILL CONTINUE TO MAKE USE OF THESE. I NOW DO MORE THAN FIVE TIMES AS MANY BANKING TRANSACTIONS THAN I DO ON A COMPUTER AND ALMOST NEVER GO INTO A BRANCH ANYMORE. SMART MONEY HAS A ANDROID APP AND THE NEW GCASH IPHONE/BLACKBERRY/ANDROID APP WILL MAKE USING MOBILE MONEY EASIER THAN EVER. THE NEW IPHONE APP WILL ALLOW ANY CLIENT TO SEND MONEY OR MAKE A PAYMENT TO ANYONE IN THEIR OWN CONTACT LIST OR EVEN VIA FACEBOOK. BANKS THAT HAVE A FACEBOOK SITE CAN ALSO MAKE USE OF THIS IN ACCEPTING PAYMENTS, REVOLUTIONIZING BANKING SERVICES BY RIDING ON THE INCREASING WAVE OF APPLICATIONS THAT EVERYDAY PEOPLE WILL BE ABLE TO USE ON THEIR HANDSETS. IN FACT STARTING LAST MONTH, I HAVE NOW MADE THE SWITCH TO USING MY MOBILE PHONE MORE THAN GOING TO A COMPUTER OR EVEN A BANK BRANCH TO DO MY BANKING MOSTLY DUE TO THE NEW APPLICATIONS THAT MAKE IT EASIER FOR ME TO USE MY PHONE TO APPROVE BANKING TRANSACTIONS.
  • Rural banks are fortunate to live in a country with two very active and supportive mobile money platforms and a very proactive and supportive regulatory environment. I highly recommend that all rural banks take advantage of these two platforms to better connect up with clients and customers. One only has to look at the figures in the market place. Globe and Smart now service over 85 million subscribers and this number is growing. Rural banks still service only 6 million clients. There are now some 10 million Filipinos that have registered to make use of mobile money services. Why not look at better ways to serve and bank these clients.
  • Preparing small financial institutions to promote mobile money and mobile financial services The importance of training and building standard operations (RBAP-MABS and work with the BSP and Mobile Money Issuers, GXI/Globe, to develop standard turnkey approaches for rural banks. Customer Value Proposition Features: What needs do the m-banking & m-commerce solutions meet? Accessibility: Distribution of transaction points Affordability: Transaction costs need to be low Ease of use: Easy to use, fast & user friendly Environment Evolution of the retail and financial sectors: Nature of financial and retail market is important for determining functionality Level of financial/electronic literacy: Influences nature of transactions Regulatory and Policy Environment Need supportive environment for mobile phone banking & mobile commerce Bring the regulators on board – early New Philippine E-Money Circular Institutional Perspective Functionality: Narrow or widely focused functionality Fees and Charges: Appropriate revenue strategy Efficiency Gains: Can the institution substantially increase business transactions at lower cost? The MABS Program has provided our bank with generic manual that contains procedures in using GCash on our mobile phone banking services adhering to standards e.g. generally accepted accounting principles (GAAP), General Banking Law, etc… This makes us comfortable in using GCash as a platform to our mobile phone banking services. Both MABS and Globe agreed to conduct a nationwide accreditation training and workshop to get in the rural banks ’ interest. For banks who signed up and qualified, MABS conducted a senior management orientation, pilot testing of mobile money services (text-a-payment, text-a-deposit, text-a-withdrawal, text-a-remittance, text-a-salary, etc.), special training on how to implement specific mobile money services based on bank ’s needs. With Globe, marketing materials, printed procedures and guides are distributed to accredited rural banks.

Transcript

  • 1. CHEMONICS TECHNICAL PRACTICES | FINANCIAL SERVICES Maximizing Efficiency in Order to Sustain a Double Bottom Line Maximizing Efficiency in Order To Sustain a Double Bottom Line
  • 2. CHEMONICS TECHNICAL PRACTICES | FINANCIAL SERVICES Maximizing Efficiency in Order to Sustain a Double Bottom Line How do we serve clients in a geographically diverse and highly dispersed population with a small market and underdeveloped cash
  • 3. CHEMONICS TECHNICAL PRACTICES | FINANCIAL SERVICES Maximizing Efficiency in Order to Sustain a Double Bottom Line How do we achieve efficiency in a high-cost structure environment and/or hard to reach areas?
  • 4. CHEMONICS TECHNICAL PRACTICES | FINANCIAL SERVICES Maximizing Efficiency in Order to Sustain a Double Bottom LineWhat innovative approaches ormethodologiesdeliver results?What challenges do they bring?
  • 5. CHEMONICS TECHNICAL PRACTICES | FINANCIAL SERVICES Maximizing Efficiency in Order to Sustain a Double Bottom LineROLES &PARTNERSHIPS
  • 6. CHEMONICS TECHNICAL PRACTICES | FINANCIAL SERVICES Country Context: in Order to Sustain a Double Bottom Line Maximizing Efficiency Philippines Archipelago: 7,100 Islands Population: almost 100M INSERT MAP OF THE Rural Population: 50% PHILIPPINES Pop. In Poverty: 30% :5.7M families Annual Remittances: $22 B # of Mobile Phones now exceed the Total Population
  • 7. CHEMONICS TECHNICAL PRACTICES | FINANCIAL SERVICES Maximizing Efficiency in Order to Sustain a Double Bottom Line Providing technical assistance and training to rural banks in microfinance best practices since 1997!
  • 8. CHEMONICS TECHNICAL PRACTICES | FINANCIAL SERVICES Maximizing Efficiency in Order to Sustain a Double Bottom Line Factors Affecting Rural Banks
  • 9. Understand your market niche? Households Enterprises TeachersOut-of-town Workers Farmers Fishermen Employees Utility companies Children
  • 10. Greater Consumer Choices
  • 11. New Technologies & Channels
  • 12. • Micro Deposits (deposits/withdrawals)• Micro Loan Disbursements and Collections• ATMs• Electronic Money Cash-in and Cash-out services• Bill payments• Remittances• Government Payments• Utility Payments
  • 13. Card-based ATM Banking
  • 14. New Customer Service Technology
  • 15. Use of Agent Networks
  • 16. Are you using Social Networking & Crowdsourcingto expand your market outreach?
  • 17. SMS MOBILE BANKING CONGRATULATIONS, YOUR CONGRATULATIONS, YOUR LOAN WITH MABILIS RURAL LOAN WITH MABILIS RURAL Rural Bank BANKS HAS NOW BEEN BANKS HAS NOW BEEN Database APPROVED. IT HAS BEEN APPROVED. IT HAS BEEN DEBITED TO THE MABILIS DEBITED TO THE MABILIS FACECARD AND YOU MAY FACECARD AND YOU MAY WITHDRAW IT AT ANY ATM. WITHDRAW IT AT ANY ATM.SMS Gateway ServerRural Bank
  • 18. The rise of Mobile Banking & Electronic Money
  • 19. Electronic Money Platforms•Card-less Mobile Money •Card-based Mobile MoneyPlatform Platform•Now linked to an ATM card •Instant Smart Money Card•Co-branded with rural banks MasterCard Debit/ATM Card ••Payments •Payments•Money Transfer •Money Transfer•Mobile Banking •Mobile Banking
  • 20. INSERT VIDEO HERE
  • 21. Preparing MFIs to Promote Mobile Money and Mobile Financial Services icess e LL unch S rv ic aaunchSeerv er ––Cuusoomer C st t m n Pr duct Prooduct A optio Addoption t mennt Reegulaoory R gulat t ry Deevelopme D velopCuusomerr C st tome t e Is ues IsssuesPeesspecivve P rr pec ti Pr duct Prooduct nt t nal Inssttitutional In ti utio T sting Teesting vironmeen Ennvironm Peesspecivvet e E P rr pec ti
  • 22. CHEMONICS TECHNICAL PRACTICES | FINANCIAL SERVICES Maximizing Efficiency in Order to Sustain a Double Bottom Line THANK YOU FOR MORE INFO: http://rbapmabstoolkit.wordpress.com www.mobilephonebanking.rbap.orghttp://mobilemoneyfordevelopment.wordpress.com https://www.facebook.com/ MobileMoneyForDevelopment https://twitter.com/Jvowens Email: jowens@chemonics.com