Rabo Development Retail Distribution Case Study: Mobile Banking and Payments
Rabo Development Retail Distribution CaseStudy: Mobile Banking and PaymentsHow Rabo Development is Using Mobile, Branchless Banking Formulas to Change Access toFinancial Services in AfricaA few slides on mobile banking and payments developmentswithin Rabo Development partner banks.Dan Armstrong, 10 May 2012
Some Popular Banking Channels Physical Banking Channels Virtual Service Channels Branch Networks IVR Banking and Call-Centre Self-Service Machines (ATMs, teller Support / Banking machines) Internet Banking (incl. Internet Partnership Models & Agency Banking Kiosks) Banking Mobile Banking “Branchless” Banking with Bank- SMS Banking and Information Owned Channels/Personnel Services for Consumers, Farmers, Vehicle Banks Business Container Banking Merchant and Retail Payments, Support for the Supply-Chain Flash and Capacity-Management Service Channels Email Banking Physical Mail Television Banking Other Value-Added Services
Distribution as a Customer AcquisitionTool Banked Customers Time
Distribution : Banking and Banking UsageTrends Alternative Traditional Physical Virtual
Distribution: No Channel is Independent of Other Issues Personnel Capacity & Bank Priorities ATM Internet Branch Switching Banking Locations Strategy Automation Other Regulatory & Core Distribution Environment Banking Channels System Agency Mobile Cards Banking Banking Existing Bank Inter-Bank Agent Competition Switching Partnerships Mobile VISA & Branch POS Operator MasterCard Strategy Competition Merchant Segmentatio Acquiring n Goals Strategy
Mobile Payments & NFC IVR Banking & Payments SMS Alerts Basic Banking, Info. Mobile Banking & Remote Payments & Mobile Contactless / Payments Electronic Wallets Proximity Payments “Mobile Money” Mobile Remittances Advertising-led Models = banks deploy = bank-led models = cooperative models = public transportation-led models = mobile operator-led models = mobile operators deploy = third-parties deploy
First of all, what do we expect from a wallet? A place to store cash? A place to store payment tokens? A place to store other tokens? A personal object? A private object? Something small enough to be portable/mobile? … but … do we need a physical object?
Then, what do we expect from a transaction device? Identification of myself, my rights and capabilities, memberships. Identification of myself, an authentication tool for payment. Secure, multi-factor Tamper-resistant/evident Personal and private Easy to use … but … do we need a physical object?
Mobile phones accepting cards, leverages existing cardbases And of course, allowing traditional credit card payments, without a card present ..
NFC stickers can be a bridging technology But the Secure Element (SE) standardisation discussions have led to stalling the ubiquity of Single Wire Protocol- enabled phones and NFC acceptance devices world- wide since 2007.
Some MFS Rabobank has launched in NL 2003-2012
Other Rabobank and Partner MFS Apps, Trials,Products
4 of NFC trails/pilots Rabobank has carried out ..
Rabobank World-Wide KeyRabobank 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
Generating Successful Formulas Currently has / uses another financial product Too poor Target / Does not have Excluded by Addressable access to the design Market product Excluded by default Does not have / use a financial product Does not want the product Has access to the product, but does not use it Potential users Based on: http://www.bankablefrontier.com/assets/pdfs/access-frontier-as-tool.pdf
Zanaco 40+ years of success, growth and stability, successful expansions, privatisation and IPO 650.000 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
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 & 9 independent agency locations Truck Banking: Zanaco mobile banking vehicles
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
Case Study: NMB Tanzania NMB: National Microfinance Bank Ltd. • Also by-far the largest bank in Tanzania • 1.8 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
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
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.
Bank Branch: RwandaNo power, internet connectivity
Bank Branch: RwandaWaiting for teller cash withdrawals
BPR Mobile Banking “Project Columbus” • Automated all 191 branches in 11 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, 125.000+ customers to-date) • BPR SMS Alerts • BPR ATM Cards • BPR QuickCash ATMs • BPR Call Centre
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%+
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
Paraguayan Socio-Economic Distribution & MBData Source: PRESENTACION - TARJETAS DE CREDITO AGOSTO 10 - FINAL.pptx High-value customers and enterprise businesses 4 % (ALTO) need to be targeted in other ways. Traditionally expensive to attract these customers. Massive potential to expand in middle, middle- 26 % (MEDIO) lower and lower income customer base with MB. This is the area where Paraguayans are under- served, but still can be profitable, long-term Banco Regional customers. Bajo alto 10 % Massive potential to expand in low-income 56 % Bajo medio 16 % (BAJO) customer base with MB. Traditionally these are un-banked Paraguayans and not automatically attractive to Banco Regional. Bajo bajo 30 % However, with a limited product set, and cost- effective support & maintenance, these could also be profitable for the bank. 14 % (MUY BAJO) Question: What are the segments applicable to a Banco Regional MB product? Likely this is upper-middle, middle, lower-middle and lower segments. Is Banco Regional interested in trying to expand successfully in these segments?
Business Case Drivers Primary: Secondary: 1. Customer Acquisition Tool 4. Loyalty • New customers in current regions • Service addition in bundles for • New customers in un-served existing customers regions • New 24/7 channel, bank in your • New customers to banking pocket 2. Cost-Savings 5. Innovation • Innovative “virtual” (alternative) • Supports Banco Regional’s channel position in Paraguay • Helps lower branch queues • Leverages lessons learned from partner banks 3. New Revenues 6. Enterprise Customers • Deposits and loans from new • Supports business account customers management with new consumer • Bundle revenues payment product in Paraguay • Direct transaction revenues • Supports payroll strategy
Concepts Introduced: Channel Management Concepts, Market Analysis, Marketing Actions, Bus. Development In-Life Feasibility, Product Business Channel Management, Case, Project Changes & Planning, Strategy Improvement, Pricing New Features Channel Management KPIs, Channel Channel Profitability Development, Analysis, Design, Development Marketing Improvement, Testing, Trial, Management Launch Reporting