Rural banking made easy with the Mama Bank Access Points.
Difficult geographies, a lack of physical infrastructure and limited technological skills are major reasons as to why people in Papua New Guinea are still underserved and underbanked. Only about 37% of the population has access to financial services.
Supply and access coupled with confidence and trust issues and the lack of disposable income to save have also been a hindrance to financial inclusion.
The Women’s Microbank Limited (WMBL), set up five years ago, is faced with these challenges every day. Issues such as how to increase trust in financial institutions and how to design a product that people with even limited disposable income can use?
With support from the UN’s Pacific Financial Inclusion Programme (PFIP) a solution was designed to boost access and usage of financial services for customers of WMBL; primarily women living in rural areas in Papua New Guinea.
Setting up the Mama Bank
In order to increase access to financial services in rural areas and to ensure that everyone, including for example illiterate women can also bank, a two-fold strategy was designed:
- Set up smaller and more affordable banking points in densely populated rural areas
- Introduce a biometric identification and authentication system.
After a year of scoping the appropriate technology required, identifying new locations, redesigning operational procedures and the type of digital infrastructure to build, WMBL launched the first Mama Bank Access Point (MAP) in Morata, Port Moresby in March 2019.
Unlike WMBL’s normal bank branches, a Mama Bank Access Point is a small structure that operates using a tablet connected to a biometric reader and a Bluetooth printer. Customers are onboarded onto the system after having their fingerprints scanned. Each Mama Bank is manned by a team of three people and at these access points, customers can simply use their fingerprint to deposit or withdraw from their bank account instead of using a signature.
Tweaks to improve customer service at the MaMa Bank
A couple of months after these first rural access points were set up, the PFIP team, in close collaboration with the bank, started monitoring these outlets and their performance closely. Some challenges were identified:
Connectivity – There were internet connectivity issues in some of the remote locations. After investigations and testing, it was decided that instead of relying on one internet service provider, whose network could drop from time to time, access point should have access to multiple back-up providers, ensuring uninterrupted service.
Strategic placement – After visiting all of the Mama Banks, PFIP and WMBL teams realized that two of the six access points were not strategically located. For the MAPs to be successful, a location near communities or market centers is required. This way women can easily walk to an access point and transact. After relocating one of these two ‘lagging’ access points there has been a significant increase in the volume and value of transactions.
Liquidity management – The MAPs use larger commercial banks, such as BSP to manage liquidity in areas where there is no WMBL branch. A MAP located far from a BSP branch runs a risk in moving excess cash. One Mama Bank was relocated closer to the BSP branch, solving the liquidity challenges of this access point, while still serving its customers.
Myths around biometrics – At the start of the project there were some myths around the usage of the fingerprint. For example, the belief that the usage of biometrics had some link with to end of the world based on misinterpretations of certain texts in the Bible. Awareness and education emphasizing the ease of use, convenience, and security of biometrics ensured that these myths are now debunked.
Power supply – Since November 2019, the country has faced intermittent power supply causing some disruptions to normal banking services. To mitigate these risks, WMBL purchased solar-powered chargers so that tablets can be charged in case of such power cuts.
Through close monitoring, most of these challenges are now turned around. This monitoring also increased ownership, responsibility and even a healthy internal competition among the different access points, resulting in increased performance of the access points.
Marketing efforts have further contributed to the success of the pilot, with adverts in the local language aired on popular radio stations. This significantly increased the customer activity going from one transaction to three transactions per account per month, reflecting a growing confidence in the use of the biometric system by the women.
Nearly one year after opening the first Mama Bank, WMBL now has six fully operational access points, servicing close to 10,000 female customers. According to WMBL, these new customers have brought their overall lending portfolio up from PGK 3.5 million in January to PGK 6.4 million in December 2019. Savings mobilization also increased from PGK 6 million to PGK 9 million over the same period.
A major contributing factor to the success of the project has been the support of the leadership of Women In Business PNG and other women groups. These women helped with building awareness, educating their members on how to use the system effectively and most importantly with financial literacy and money management skills.
By offering services closer to the women in rural communities, Women’s Microbank Limited is helping to improve economic opportunities for female entrepreneurs in rural areas of PNG. Some of the bank’s customers share their experience themselves in this video below and this impact story.