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Mobile Banking & Rabo Development Partner Banks

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Mobile Banking & Rabo Development Partner Banks

  1. 1. Mobile Banking is MainstreamRabo Development : Case Studies in Mobile Banking & Payments Development<br />A brief presentation on mobile banking and payments developments within Rabo Development (Rabobank International); as well as some case studies of how Rabobank uses lessons learned in developing countries.<br />Dan Armstrong<br />02 December 2010<br />
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  3. 3. Landscape of Mobile Banking and Payments<br />Rabobank, ABN AMRO, ING, SNS, etc.<br />1990-1999, continues …<br />2002, continues … (quite popular)<br />IVR Banking & Payments<br />SMS Account Activity Alerts<br />Multi-ChannelBalance-Checking<br />Others …<br />Full-Service Mobile Banking<br />Remote Payments and Electronic Wallets<br />Mobile Contactless Payments (NFC)<br />Java<br />WAP<br />STK<br />USSD<br />iPhone<br />Windows Mobile 6.5/7<br />Samsung JET, Bada<br />Android<br />Etc.<br />VISA MobileAndroid<br />( ?)<br />Note: not exhaustive, there are other technologies used in the world, but these are the major ones.<br />
  4. 4. Landscape of Mobile Banking and Payments : Detail<br />Can be ok, but a subset of Full-Service Banking?<br />Legacy<br />SMS Account Activity Alerts<br />IVR Banking & Payments<br />SMS Account Activity Alerts<br />Multi-ChannelBalance-Checking<br /><ul><li>Security: PIN-based, CLI can be used (but not reliably)
  5. 5. Easy-to-use, menu-driven navigation
  6. 6. Works on every phone
  7. 7. Cumbersome
  8. 8. Bank-pushed method; normally offered for free to customers
  9. 9. Simple to understand (can be)
  10. 10. Works on every phone
  11. 11. Can be applied to many products (accounts, loans, offers, discounts, etc.)
  12. 12. No transactions or advanced features
  13. 13. Customer-pulled method
  14. 14. Simple to understand (can be)
  15. 15. Can be applied to many account types
  16. 16. Can be done via SMS, WAP, USSD or apps
  17. 17. Is a “killer app” in many regions, including Western Europe
  18. 18. Somewhat limited in scope</li></ul>Mobile Operators,Transport,Modern Banks … ?<br />Future?<br />Full-Service Mobile Banking<br />Full-Service Mobile Banking<br />Remote Payments and Electronic Wallets<br />Mobile Contactless Payments (NFC)<br /><ul><li>Can be easy-to-use
  19. 19. Full-service = transactions, inquiries, actions, information
  20. 20. Saves trip to the ATM or bank, supports virtual channels, saves direct bank costs
  21. 21. Can be made to work on many phones, but app-based functionalities require specific phone strategy, development, costs
  22. 22. More complicated to launch and maintain, but allows for transaction charges
  23. 23. Except for mobile network operator distribution networks (M-PESA, MTN Mobile Money, ZAIN ZAP, Tigo Cash), bank wallets have enjoyed limited success world-wide
  24. 24. Some successes: Apple iTunes Store, PayPal, some Japanese products, public transportation.
  25. 25. Likely a step too far for developing (and developed?) banks, customers can directly access their bank account!
  26. 26. Card-emulation products in trial since 2004
  27. 27. Lack of mobile network operator business case (and they normally buy wholesale phones)
  28. 28. Difficulty in making a business case for a contactless phone vs. contactless cards.
  29. 29. Handset availability - there are no phones!</li></ul>SIM Tool Kit  Apps V1  Apps V2  USSD  WAP  etc.<br />
  30. 30. Remote payments can take on different forms …<br />Complicated landscape currently surrounding “remote payments”, as differentiated from “proximity payments”<br />Online versions: Paypal, iDEAL, credit card, Facebook Payments, internet banking, etc.<br />In the future, is the mobile phone simply a small internet device? However, different ..<br />Security (authentication) issues<br />User-experience issues <br />Trust issues<br />2010 seems to be a “hybrid year” ..<br />Old mobile payment models going away (SMS, WAP, OTP-only models)<br />Clear trend towards mobile applications<br />Increased usability of mobile banking, mobile payments, in-application payments and e-value<br />However, standards? 3-corner model vs. 4-corner model clearly an issue ..<br />VISA Mobile<br />
  31. 31. Some examples of mobile remote payments “successes”? <br />???<br />???<br />???<br />???<br />???<br /><ul><li>What are the business goals for enablement of the iTunes store ecosystem?
  32. 32. Profitability for apps?
  33. 33. In-app payments?
  34. 34. Proximity payments???
  35. 35. Hardware sales, lock-in?
  36. 36. M-PESA (Kenya) a huge success, but not many other countries have had similar experiences.
  37. 37. P2P money transfer first, expansion to payments , savings accounts (MKESHO)
  38. 38. However, business goals are churn reduction / loyalty to the SIM card?
  39. 39. GCASH (Philippines) leapt from P2P money transfer for retail payments quickly.
  40. 40. Can be a strategy in countries without POS; however, is it mobile operator core business?
  41. 41. Partnerships, fragmentation, consolidation?</li></li></ul><li>Leveraging Knowledge, Experience & Platforms<br />
  42. 42. Rabobank International<br /><ul><li>Rabobank’s international market niche is food- & agri business
  43. 43. Customer Network: many of the global food companies
  44. 44. Expertise: dedicated research team (80 professionals)
  45. 45. Agri products: weather derivatives, price hedging instruments
  46. 46. Rural retail banks in various countries</li></li></ul><li>Rabobank Development<br />Eligible banks:<br /><ul><li>Developing (low income) economies
  47. 47. Economic, political and social stability
  48. 48. Rural area and agricultural sector important for economy
  49. 49. Open for foreign investments
  50. 50. Safe for our staff</li></li></ul><li>Case Study : Xapit Instant Banking (Zambia)<br />
  51. 51. Zanaco<br />Zambia: “One of the World's fastest economically reforming countries.” (The World bank, 2010)<br />40+ years of success, growth and stability, successful expansions, privatisation and IPO<br />450.000 customers, 1.200 employees<br />Year-on-year profitability, K3 bln in assets, mature risk management regime. Healthy account portfolio including:<br />Retail: account services, personal loans, e-banking, Xapit, remittances, cash services<br />Corporate: credit facilities, e-banking, cash services, treasury and investments, trade services<br />Successful branch network (50), automation and professional working practises, personnel and administration<br />Transformation to modern banking tools (100 ATMs, internet banking, mobile banking)<br />Pilot collaboration with Zampost, rolling out to ~100 new locations in 2011<br />Rabobank: 49% (2007)<br />ZamPostPOS<br />
  52. 52. Distribution : Zanaco Branch & ZampostNetwork<br />
  53. 53. Images of Zanaco<br />
  54. 54. Xapit Instant Banking<br />Launched in late 2008, USSD II mobile banking & ATM card<br />Sign-up for an account and get mobile banking and a VISA debit card in 5 minutes.<br />231.000 customers to-date (>50% of Zanaco base), 183.330 with a “Xapit Account”.<br />20+ bill payment partners, prepaid airtime, etc.<br />June 2010 Usage: 21 transactions per month (average), 1.56 mln transactions per month total<br />MNOs: ZAIN, MTN & CellZ (all)<br />*444#<br />
  55. 55. Case Study : FMB Mobile (Malawi)<br />
  56. 56. First Merchant Bank : FMB Fast Account<br />FMB<br />19 branches, corporate and retail banking, 600 employees<br />1/11 commercial banks in Malawi<br />FMB Mobile / FMB Fast Account<br />Launched summer of 2010, >40.000 new customers to-date (and new bank accounts)<br />Successful to-date – packaging of ATM card, bank account and mobile banking functionality<br />Includes immediate (small) balance on customers’ account, facilitating usage of the new product<br />
  57. 57. Case Study: NMB (Tanzania)<br />
  58. 58. NMB: National Microfinance Bank Ltd. (Tanzania)<br />1,8 mln customers (500k increase with the launch of mobile banking/payments)<br />Consumer and small-business focused<br />Dedicated to providing sustainable, viable access and direct financial services.<br />Proud of our history of support for Tanzanians of all income levels, government and businesses.<br />Close By<br />Extensive (largest) network with 145 branch locations and 300+ ATMs nation-wide.<br />Branch network designed to cover minimally 80% of Tanzanian districts.<br />Empowering Entrepreneurs<br />Paying special attention to micro, small/medium-sized and rural business.<br />Tanzanian agriculture is close to NMB’s heart (KILIMO KWANZA) and they play a roll in all parts of the supply chain.<br />Rabobank : 35% (2005)<br />Case Study: NMB mobile (Tanzania)<br />
  59. 59.
  60. 60.
  61. 61. Features the most desired consumer applications:<br />Balance Inquiry<br />Mini-Statement<br />Money transfers to any NMB account<br />TanescoLuku Prepaid Electricity Purchase<br />Vodacom and ZAIN Prepaid Airtime Top-Up<br />NMB Services like ATM card block, settings<br />Works with NMB Personal Account, TPDF Account, Student Account, Wisdom Account<br />Simply dial *155*66# to access<br />No need to fill-in forms or visit an NMB branch to sign-up, simply dial *155*66*123#<br />NMB mobile:<br />Launched in August 2009<br />360.000+ active customers to-date<br />Prepaid airtime, bill payment, prepaid electricity<br />Vodacom, Zain, Tigo, Zantel (99% mobile penetration)<br />SMS Alerts to 220.000 customers monthly<br />June 2010: 1.86 mln transactions per month total<br />NMB mobile<br />NMB mobile<br />1. Balance Enquiry <br />2. Mini-Statement<br />3. Money Transfer<br />4. Prepaid Services<br />5. Other Services<br />6. Help <br />
  62. 62. Example: Mobile Banking Menu (USSD)<br />Your NMB account balance is: TSH 000,000.00Enter “9” to return to the main menu.<br />NMB mobile<br />Balance Enquiry <br />Mini-Statement<br />Money Transfer<br />Bills & Payments<br />Purchase Airtime<br />Bank Services<br />Help <br />*155*66#<br />NMB mobile<br />Please enter your NMB mobile PIN.<br />NMB mobile<br />1. Balance Enquiry <br />2. Mini-Statement<br />3. Money Transfer<br />4. Bills & Payments <br />5. Purchase Airtime<br />6. Bank Services<br />7. Help <br />Pease enter the recipient account or phone number registered for NMB mobile that you wish to transfer money to:<br />Enter the amount of money to be transferred:<br />Please confirm your money transfer:TSH 000,000will be transferred to <br />Enter “0” to confirm transfer and send.<br />Money transfer successful!TSH 000,000was transferred to <br />NMB mobile Ref. No: 12345678Enter “9” to return to the main menu.<br />
  63. 63.
  64. 64. NMB Milestones<br />ATM Money Transfer<br />NMB Personal Account: ATM Roll-Out Begins<br />Internet Bankingfor Corporates<br />NMB SMS Salary Alerts<br />TanescoLuku Payment via ATMs<br />Vodacom Airtime via ATMs<br />100 ATMs within 1 Year<br />2006<br />2007<br />2008<br />2009<br />NMB Business Account<br />NMB TPDF Account<br />NMB Bonus Account<br />85.000 SMS Salary Alerts Users<br />IPO: NMB Welcomes 27.000 new Shareholders!<br />NMB Wisdom Account (pensioners)<br />200 ATMs within 2 Years<br />
  65. 65. Case Study: BPR (Rwanda)<br />
  66. 66. BPR Mobile Banking<br />Banque Populaire du Rwanda<br />1.3 mln customers, 1.400 employees, 189 locations nation-wide<br />Rabobank: 35% (2008)<br />BPR Mobile Banking <br />Launched September 2010, >40.000 customers to-date (11 weeks)<br />USSD II mobile banking & SMS Alerts<br />Prepaid airtime, bill payments, electricity, DStv, StarTimes<br />MTN & Tigo (90%+ mobile penetration)<br />
  67. 67. BPR Branch Network<br />
  68. 68. BPR’s customer survey validates the vision ..<br />Would you trust a mobile phone for transfers and purchases?<br />Would you like to carry less cash?<br />Would you use a mobile phone for banking?<br />Would you be willing to pay for it if it added value?<br />Results: BPR Mobile Banking customer survey, April-May 2010, 7 branches & 170 customers interviewed.<br />
  69. 69. Mobile Banking<br />Balance Inquiry<br />Mini-Statement<br />Money Transfer (BPR Accounts)<br />Prepaid Airtime<br />MTN<br />Tigo (pending)<br />Bill Payments<br />RECO Prepaid Electricity<br />StarTimes Africa TV<br />DStv<br />MTN Postpaid Bill<br />Tigo Postpaid Bill (pending)<br />Bank Services <br />Change BPR Mobile Banking PIN<br />Change Language<br />Order Cheque Book<br />Help<br />What can you do?<br />Also: Free SMS Salary Alerts!<br />
  70. 70. Customer signs-up at a connected branch at the Customer Service desk<br />They identify themselves with their ID<br />We validate ID and automated account<br />We then search for the customer on the mobile banking system website (by account no.) and enter their mobile phone no.<br />BPR Mobile Banking will send a SMS to the registered phone no. with a welcome message and an initialmobile PIN<br />Newly registered customer will dial the USSD code and will be prompted on first logon to change their mobile PIN<br />All accounts with the same customer ID will be automatically linked to the phone no. <br />How will customers sign up?<br />
  71. 71. Phase 2: Expansion<br />Banking the Un-Banked, A Modern Savings Account for All Rwandans<br /><ul><li>A transactional savings account that you can sign-up for in your own village or farm.
  72. 72. An account that doesn’t require “connected” branches to work.</li></ul>Phase 1: Launch<br />In this phase, BPR wants to establish the platform for mobile banking – starting with valuable services for existing customers.<br /><ul><li>Successfully launch our platform, product and brand
  73. 73. Work out any kinks, get customer feedback
  74. 74. Attract new customers to the bank</li></ul>Phase 1.5: Development<br />Launch new services, alerts, features<br /><ul><li>Rwanda Revenue Authority
  75. 75. Soras & Sonarwa Insurance
  76. 76. Rwandatel (3rd mobile operator)
  77. 77. B2B Payments
  78. 78. Merchant Payments</li></ul>BPR Mobile Banking Roadmap Strategy<br />Q3 2010<br />Q4 2010<br />Q1 2011<br />Q2 2011<br />
  79. 79. Phase I: Planning (2 weeks, 26 April – 07 May)<br />Phase II: Design & Architecture (2 weeks, 17 – 28 May)<br />Phase III: Build (5 weeks, 31 May – 09 July)<br />Phase IV: Test & Acceptance (3 weeks, 12 – 20 July)<br />Phase V: Friendly User Test (3 weeks, 02 – 23 August)<br />Launch (24 August, Rwanda International Trade Fair) – Sept. Live<br />Launch Timing<br />Friendly User Test<br />Test & Acceptance<br />April<br />May<br />June<br />July<br />August<br />I<br />III<br />IV<br />V<br />II<br />
  80. 80. BPR Mobile Roadshows & Sign-up Success<br />
  81. 81. BPR Mobile Roadshows & Sign-up Success<br />
  82. 82. Our partner banks have a number of approaches to products, channels, segmentation and market-engagement.<br />However, a full “Product/Channel Management” regime is rarely in place.<br />We have tried to implement a basic product management regime. This will support:<br />End-to-End Product Responsibility<br />Change Management<br />Business Cases<br />Formulas (e.g. using products for segments, business goals)<br />Normalised Tariffing, Competitive Analysis<br />In addition to the “Product Life-Cycle”, Product Management can also be used to coverthe “Customer Life-Cycle”<br />Product & Channel Management<br />ChannelStrategy<br />ChannelDevelopment<br />ChannelMarketing<br />ChannelManagement<br />
  83. 83. Customer “Life-Cycle” (Rabo Mobiel)<br />Orientation<br />Provisioning<br />Changes / Updates<br />Service Deactivation<br />2.<br />1.<br />3.<br />4.<br />Service Request<br />Customer Problems<br />Service De-Provisioning<br />In-Life Usage<br />Orientation: product values & messages, marketing campaign, information to customers & branches, offer / service definition, tariffing<br />Service Request/Provisioning: request-initiation, back-office processes & systems, customer confirmations, error handling & exception cases, reporting<br />In-Life Usage/Changes/Updates/CS: daily usage & reporting, faults & change management, customer queries & problems<br />Service Deactivation/De-Provisioning: customer-initiated processes, bank-initiated processes (e.g. fraud or misuse), back-office processes<br />
  84. 84. In order to better manage some of the problems issues (e.g. processes, tariffing, development and launch of new products), partner banks should implement a “Product Lifecycle” approach.<br />In this approach, specific products or groups of products would enjoy better:<br />Ownership<br />Price vs. performance analysis<br />Development, improvements, communication, sales support<br />KPIs / MIS on performance<br />Product “Life-Cycle” (Zanaco Example)<br />
  85. 85. Mobile has the capability to leap-frog internet access in Africa, and it’s working.<br />Technology (and security) needs to be balanced with usability.<br />Proving the products’ worth is critical in Africa. <br />Focus on usability campaigns, promo teams, local activities<br />Above-the-line marketing messages<br />Continual development / channel enrichment<br />Very cheap pricing works, but not free.<br />Product/Channel Management is easy to implement when introducing new products and channels, and can be retroactively applied to other business areas.<br />We can learn a lot in Western Europe from our partner banks in Africa and South America!<br />Lessons Learned<br />
  86. 86. Thank You!<br />

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