The UN Capital Development Fund (UNCDF) and The MasterCard Foundation today released a new publication titled Assessing New Youth-Focused Products: Pilot Testing Financial and Non-financial Services for Youth in Sub-Saharan Africa.
The paper is based on the experiences of 10 financial service providers in Sub-Saharan Africa that are part of YouthStart, and synthesizes key recommendations, technical considerations and best practices when launching new youth-focused services. It was launched at a panel discussion at Making Cents International’s 2012 Global Youth Economic Opportunities Conference, which was facilitated by YouthStart Program Manager, Maria Perdomo. . The Conference is the biggest international forum on youth financial inclusion.
With almost 16,500 youth clients reached through their pilot tests, the 10 financial service providers explored a number of hybrid, unconventional methods for outreach, and discovered several successful techniques to ensure that product design and implementation meet the needs of young people.
“Pilot-testing any new financial-service product is critical for a financial service provider, but the need is even greater for those testing youth products—due to a common lack of understanding of youth and how best to serve them,” said Christine Roth, Executive Secretary a.i. at UNCDF.
The paper is a resource for other financial service providers considering an introduction or improvement of youth-focused services, especially those piloting savings products and financial literacy training for youth. It offers recommendations that include the following:
- Develop policies and procedures that include (1) age verification, (2) flexibility in accepting different forms of identification, (3) special savings passbook and (4) need for adult authorization (in the case of minors).
- Develop a marketing strategy using informal, low-cost techniques and tailored messages for girls and other vulnerable groups.
- Focus marketing efforts on partners, parents and youth peers.
- Use unconventional distribution models, focusing on getting out of the branch and going where the youth are.
- Ensure there is understanding by and incentives for staff to cross-sell to parents and guardians. Take advantage of contact with parents of youth at account opening to promote the services that specifically target adults.
- Focus on and incentivize account usage. Account opening is not enough: ensure that continued usage of services is as, or even more, important than uptake.
- Keep the financial-literacy curricula simple and consider delivering it through a unified business model.
This publication on financial service providers’ experiences piloting youth products can be downloaded at www.uncdf.org