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Case Study – EasypaisaA Microfinance Institution with the largest footprint

Aiaze Mitha, Neu-Anspach, 20 November 2013

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Pakistan Demographics

Population180 m

Financial Access Banking Penetration ONLY 12% -14% Informal Financials Access Means 35%

Telco Penetration68% ( 118 m ) Mobilink ( 35.8m ), Telenor ( 30m ) , Ufone ( 23m ), Zong ( 16m ), Warid ( 14m )

Need for Mobile Money

• Improved access to financial services

• Convenient/Efficient way to distribute/receive the funds

• A service that can be linked to microfinance

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Mobile Money in Pakistan

MNO acquiring a Financial Institution

09/2009: in 2008, Telenor has acquired a 51% stake in Tameer Bank (MFI) and subsequently launched Easypaisa in partnership with Tameer bankEasypaisa is a mobile account that enables any mobile users to do any type of transactions Easypaisa Khushaal is a savings product launched in Oct 2012.

Bank Led Model

04/2010: Omni is a branchless banking service powered by UBL Bank and available in more than 600 locations in PakistanMobile and card account holders can do a vast array of Financial transactions

Partnership between a bank and a MNO

12/2012: Mobile banking service offered by Zong(MNO) and Askari Bank. Through the service mobile account holders can transfer funds or pay utility bills.

Operator Led Model

11/2012: Mobile banking service offered in partnership with Waseelabank that recently obtained a license from the Central Bank to offer mobile banking services

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Overview

Description

PartnersTelenor (MNO) – 30 million subs, 180,000 retailersTameer Bank (MFI)

Target Consumer Segments

In 2008, Telenor acquired a 51% stake in Tameer Bank (MFI) and subsequently launched Easypaisa in partnership with Tameerbank in Oct, 2009.

Seg1 – 118m Pakistanis ( mobile phones )

Seg2 – 30m bills per month

Seg3 - $ 7bn per year ( Domestic Remittances )

Seg4 - $ 9bn per year ( Incoming International Remittances )

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Easy Paisa Evolution

Sep 2009 Feb 2010 Jun 2010 Aug 2010

Easy Paisa Launch Easy Paisa Mobile Account Easyload Donation

International Money Transfer

Easy Paisa Mobile Account Relaunch

EOBI ( Employees Old Age Benefits Institute )

Benezir Income Support Program

Khushaal Munafa

Sep 2010 July 2011 Jan 2012 Oct 2012

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Easy Paisa – Distribution Network Growth

0

5000

10000

15000

20000

25000

30000

35000

2010 2011 2012 2013

Agents

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Easy Paisa - Business Growth

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Easy Paisa – Success Factors

MNO and MFI Partnership – Strategic alignment further reinforced by Telenor’s ownership stake in Tameer. Telenor brings a large distribution network, large customer base and marketing know how, Tameer brings banking experience and financial product innovation.

Ability to strengthen all core businesses

Supportive Regulatory Framework for Branchless Banking.

Incremental Product Offerings targeting various Customer Segments.

Distribution Strategy – Started with 2000 Agents in urban areas and incremented over the period of time covering rural areas . As of 2012, approx. 20,000 Agents in 750 different locations.

Effective Marketing and Promotion

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