Mobile money and microfinance European Microfinance Week Antonique Koning November 2, 2011.

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  • Slide 1
  • Mobile money and microfinance European Microfinance Week Antonique Koning November 2, 2011
  • Slide 2
  • Cash in/out Receipt/ Cash Bank Agent Client Credit/Debit Client Account Debit /Credit Agent Account Branchless Banking: What do we mean? delivery of financial services outside conventional bank branches using information and communications technologies and nonbank retail agents. MNO 2
  • Slide 3
  • The case of Brazil: bank-based model Brazil has 150,000 Banking Correspondents (BCs). Today, all of Brazils municipalities have at least one correspondent (Brazil has 5,564 municipalities!) The main banking agent networks in Brazil processed approximately US$104 billion in 1.5 billion transactions in 2006 (Marques, Sobrinho, 2007). 80 million adults in Brazil still lack access to bank accounts Overview 3
  • Slide 4
  • The case of Kenya: a nonbank-based model M-PESA launched in March 2007 by mobile operator Safaricom, and now has: ~13 million customers 23,000 agents ~$300 million transfers per month avg. Customer satisfaction: Users say it is faster (98%), more convenient (97%), and safer (98%) than alternatives 4 out of 5 say not having it would have a large negative impact on their lives It is the main means of sending money for 50% of Kenyans Overview 4
  • Slide 5
  • 5 20 percent of branchless banking implementations reaching scale 100% = 114 implementations Top 15 implementations
  • Slide 6
  • CONTEXT: ROLE OF MFI: MFIs in countries with existing mobile banking infrastructure MFIs in countries with no existing mobile banking infrastructure Act as agent on behalf of bank or MNO Use m-banking system for loan disbursements/ repayments and/or deposits Build mobile banking system Build mobile banking system Use phones for data collection and other non-cash purposes Typology of MFIs in mobile banking 6
  • Slide 7
  • Benefits for MFIs and their customers of using m-banking Serve Existing Customers Better: M-banking provides existing customers with flexibility in when and where they make loan payments and deposits, shorten group meetings and decrease cases of theft and fraud. Reduce costs for MFIs and customers: M-banking can reduce operational costs for MFIs and these can be passed on to customers in the form of lower interest rates. However, one commonly assumed benefit reaching new customer segments will not be easily realized. This is because microcredit methodology relies heavily on human interactions. 7
  • Slide 8
  • Emerging lessons for public funders in branchless banking
  • Slide 9
  • Advancing financial access for the worlds poor www.cgap.org www.microfinancegateway.org

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