Mobile Strategies for Financial Institutions

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Mobile Strategies for Financial Institutions

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Mobile Strategies for Financial Institutions

  1. 1. Mobile MoneyStrategies for Financial InstitutionsMobile World Congress, Barcelona17 February,2011 Teppo Paavola, GM, Nokia Mobile Financial Services S.C. Kalia, S C Kalia Executive Director, Union Bank of India Company Confidential 2 © 2011 Nokia
  2. 2. Co su e pain points eliminated by mobile moneyConsumer pa po ts e ated ob e o ey SAFETY B2B all your wealth under mattress. In close your shop, carry cash to pre-paypublic transportation - carrying lot of wholesaler in next city for next daycash delivery y ACCESS GET PAID closest bank branch 20 miles away. farmer delivers to city. Wholesaler:”NoNo PC. No point-of-sale payment cash right now, come back next day”terminal DISTANCE, EFFORT, TIME BRIBERY, BRIBERY FRAUD sending prepaid SIM cards h di id d home i ainpostman knows your letter has cash. letter as a means of transferring fundsAsking for a tip – “10%?” g p % stand one hour in line to pay forgovernment agent tells: “your benefit electricity. Then another line for gas…payment did not arrive this month your prepaid account runs out in theeither” ith ” middle of a call t your loved one iddl f ll to l dCompany Confidential3 © 2011 Nokia
  3. 3. Nokia Money - Service co cept o a o ey Se ce concept Simple and intuitive mobile Initial focus on emerging markets; money service basic services Always in partnership with a bank; • Topup and preferably with operators • Pay bills • but not tied into any particular y • Send money banking/operator network • Pay merchants • In India with Union Bank of India Many other opportunities exist once the network is in place • Multiple brands may exist in distribution Works on most mobile devices, also from other manufacturersCompany Confidential4 © 2011 Nokia
  4. 4. Turning Telecom Retailers to Agents forKYC & cash-in & cash-out hi h t • ‘Agent application’ in a regular mobile device d i • Consumer native application in preloaded Phones. p • Application Side-load or SMS IVR for less capable phones. “All you need to know is the phone number” number • Commission & incentives to agents – only for customers doing transactions • Nokia is the ”Master Agent” for the bankCompany Confidential5 © 2011 Nokia
  5. 5. Face to Face Payments – no need for a separate payment terminalMobile Devices :The New Cash Register & POSCompany Confidential6 © 2011 Nokia
  6. 6. Pay Bill in few clicks instead of going & queuingMNO Top-Up,UtilitiesServicesS iInsurances, FlexibilityCharities Time savingsCompany Confidential7 © 2011 Nokia
  7. 7. Connecting People to what matters MoneyCompany Confidential8 © 2011 Nokia
  8. 8. Union Bank Indian scenarioMobile money services 85,000+ Bank Branches 65,000 + ATMs 60 Million Internet Users 687 Million Mobile Users
  9. 9. The Bank• Head office of the Bank inaugurated in 1921 by Mahatma Gandhi – Father of the Nation• 5th largest Bank in India with business mix Rs 3.20 Trillion (~ $ 70 billion)• Operating profit – 26 67% CAGR 26.67% CAGR,• Net Profits – 19.67 %CAGR• 3000 Branches and 6 Overseas Offices / Branch• First Bank to offer Mobile Banking in India• 30 Million customers, 6.2 Million Debit cards
  10. 10. Financial Inclusion A BUSINESS OPPORTUNITY BANK’S ENDEAVOUR• Financial Inclusion is to provide banking • Extending basic banking facilities services to vast section of unbanked/under to unbanked & marginally banked banked populace at an affordable cost. • Adopting both Branch and Branchless• 60% population in India do not have Banking access to a bank account • Providing Financial Literacy for gainful• Only 30,000 out of 600,000 villages in utilization of services India have a bank branch • “ Need” creation among the target• Banks will be extending reach to 2000+ group gro p population villages in first phase by March • Extending a combination of banking 2012 through Business Correspondent model; products• In second phase, villages with population • Spreading Financial Literacy <2000 will be taken up; Ride on the telecom wave to achieve• Outcome - Speedy implementation p y p financial inclusion of Financial Inclusion
  11. 11. Financial Inclusion – Union Bank• Bank has drawn a 3 year Financial • Rs 3.27 bn (~ $ 71mn) disbursed to Inclusion Plan to cover 10 million the Milk Pourers of National Dairy customers across 32,000 villages t 32 000 ill Development Board (NDDB) in 2 with 20,000 BCs years• 4.6 million customer base under branchless banking using Biometric • 0.7 0 7 mn Micro Remittances handled cards amounting to Rs. 3.22 bn (~ $ 70mn) through Branchless banking in last 15• 14587 Villages covered months th• First bank to introduce micro loan products repayable in weekly installments i t ll t• Rs 6.42 bn (~ $ 140mn) Government benefits disbursed in 2 years y
  12. 12. Importance of Mobile Banking• Over 687 million mobile phone subscribers in India and the number continues to explode.• Financial services companies are now working with mobile p y p g payment players to offer innovative mobile phone solutions to urban and rural Indian population.• Reserve B k of I di h restrictions on non-bank i R Bank f India has t i ti b k involvement i l t in money transfer.• Development of mobile financial services applications is being sponsored primarily by banks in India.
  13. 13. Advantages of the Engagement with NOKIA• Reach out large population across India by engaging 200,000 plus Retail outlets of Nokia as Business Correspondent Agents• A cost effective model, riding on the established infrastructure, to provide affordable Banking services• Exploit the proliferation of mobile phones in the country and use this popular medium to reach large number of banked and unbanked customers• Cross-sell a host of banking and payment services• Achieve our targeted reach of 10 million FI customers across 32,000 villages through 20,000 Customer Service Points by 2013 Union Bank Money - First large Mobile Prepaid implementation in India
  14. 14. Thank youSpreading smiles across miles….

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