In December 2017, as part of its commitment to improve financial inclusion in Ghana, the United Nations Capital Development Fund (UNCDF) and the United Nations Development Program (UNDP) in Ghana organized a three-day training on Agent Network Management for fintechs, banks and government institutions in Accra to build their capacity in developing and optimizing their agent network. By the end of the training, the participants will be able to assess their current agent network strategies, reporting tools and outreach tactics considering best practices around the globe and develop an improved planning and roll out of their agent network management.
This will contribute directly to the achievement of SDGs 1 (No poverty), 2 (Zero hunger) and 8 (Decent work and economic growth)
Significant progress made on financial inclusion in recent years has been largely driven by mobile technology, digital payments, and branchless banking. With the rise of mobile penetration and mobile money usage, the number of financial account holders has dramatically increased. Opening a mobile money account can be for many the first time they use formal financial services, leapfrogging into the formal economy. This is especially true for Sub-Saharan Africa (SSA), where mobile money accounts drive the growth in overall account penetration.
According to the McKinsey Global Institute´s article, “How Digital Finance Could Boost Growth in Emerging Economies” digital finance has the potential to provide access to financial services for 1.6 billion people in emerging economies. More than half of these unbanked are women. This could create up to 95 million new jobs across all sectors of the economy.
Benefits of digital ecosystems are manifold. Digital payments reduce costs, increase transparency, boost domestic resource mobilization, and help eliminate theft and loss. Digital payments also create new economic opportunities, including the ability to participate in the formal economy and gain access to new markets. This in turn advances financial inclusion, empowers women, and helps to drive inclusive growth. In a nutshell, digital finance ecosystems may translate into win-win‑win situation, benefiting financial service providers (FSPs) clients and the social ecosystem.
For financial institutions, the only way to go is to adopt technology and alternative delivery channels. But the challenge for many financial institutions is knowing when and how to take this initiative. Agent network management therefore becomes a critical ingredient in the success of the implementation, and scalability of digital financial services by financial institutions.
This workshop stemmed from efforts initiated by UNCDF through its Microlead program to support the provision of savings-led financial services to low-income people particularly women and those living in rural areas, working with partner FSPs to transition to digital finance. With the program’s support, financial institutions have progressively gained a better understanding of the success factors and challenges associated with digitalisation and most suitable business models to engage in DFS provision depending on their own specificities.
As part of its market system approach to address the key barriers that FSPs face during their digital journey, MicroLead supported this workshop at the industry level for FSPs (rural banks, microfinance institutions, banks, post banks, MNOs, fintech) and regulators. By the end of the training, the targeted institutions were able to get a better insight on the issue of agent network management. The training was be based on lessons learned from Digital Financial Service Providers (DFSPs) worldwide that leveraged on agency banking and agent network management to improve the delivery of better and far-reaching financial services.
The workshop was organized in two batches of three days each for 30 participants by UNCDF with support from UNDP. It relates to two big financial inclusion projects viz: D4I (Digital for Inclusion) and Youth in Revenue Mobilization projects being implemented in partnership with UNCDF as the technical service provider.
D4I project is implemented as part of the government’s initiative to promote equal access to digital, and formal financial services for rural dwellers. The project, which is a partnership with Zeepay, GIFEC, NBSSI, Blue Town Aps and UNCDF, will bring economic empowerment to people in 37 cocoa growing communities, Zongos and those who are financially excluded due to location and other factors beyond their control. D4I leverages digital to create access to financial services (e.g. domestic transfers, remittances, microlending, and micro insurance) to those who are excluded. D4I is expected to generate direct employment for an estimated 2,000 people and indirect employment for approximately 4,000 people over the next two years. The pilot phase would run for nine months and immediately impact over 200 districts nationwide. The objective of the project is to open the identified economies and deepen inclusion. D4I will reserve 60 percent of the created opportunities for women and 10 percent for disabled persons within the Cocoa Small Holder Farm Communities and Zongos nationwide.
The Youth in Revenue Mobilization is implemented by the Youth Employment Authority (YEA), Eban Capital, AYA Technologies and UNCDF to create jobs for 50,000 un-employed graduates, improve access to financial services in rural and remote areas and increase revenue mobilization across the country.
Participants are taken through digital financial inclusion services, specifically, agent management regulation, approaches to agent management deployment, agent loyalty, agent reward and will be expected to go back and train other stakeholders in the project to implement same at the grassroots level.
Participants at the workshop include representatives from Zeepay, GIFEC, NBSSI, GN bank, Access Bank, First Allied Savings and Loans, Eban Capital, YEA, Aya Technologies, NITA and GCB Bank.
Other participants are financial inclusion stakeholders engaged in Agency Banking such as First Allied Savings and Loans, GN Bank, Access Bank and numerous fintech.
By Noel da’Cruz & Hermann Messan, UNCDF