Oct 2, 2012 - It is managed for DFID by PricewaterhouseCoopers ... with the International Business Leaders Forum and Acc
Inclusive Business
CHECKLIST Would my business benefit from mobile money and mobile banking? Benefits of mobile money and mobile banking 1. Reduced cash handling costs, risk and fraud 2. A transparent and traceable audit trail 3. Reduced capital and operating expenditure 4. Increasing outreach and field officer efficiencies 5. Back end and administration savings 6. Quicker and more accurate management reports 7. Innovative product design and new revenue opportunities as a result of reduced costs 8. Direct marketing to potential and current customers through SMS or USSD
Inclusive Business Checklists provide a quick and simple way to determine how effective an idea, tool or model might be for your inclusive business project. They can be used by inclusive business practitioners, to develop and scale up business strategies. They are based on the real-world experiences of companies actively expanding opportunities for people at the base of the economic pyramid through their core business activities.
Organisations know the importance of technology in their operations and are increasingly aware of the benefits of mobile money and mobile banking. Compared to cash transactions, mobile banking and mobile money transfer (MMT) is characterised as being: • Cheaper • Safer • Quicker • More transparent • Traceable • Convenient It has the potential to increase financial inclusion to the ‘un-banked’ and especially to the rural population. However, implementing mobile banking / mobile money can be complicated. This Checklist covers the issues that an organisation should consider when implementing mobile money.
Mobile Banking is a collective term for a bank’s customers to do banking activities such as checking account balances, depositing, withdrawing or transferring funds, without entering a branch. These activities can be done via Alternative Delivery Channels (ADCs), such as Point of Sales machines, ATMs, internet banking and mobile phone / SIM banking. Mobile Money Transfer (MMT) does not require the user to have a bank account, but allows users to store ‘value’ on their ‘mobile wallet’. A user can withdraw funds for cash, transfer funds to other users, and make or receive payments to / from third parties. MPesa in Kenya is the most well known example of MMT.
What are the options for a service provider offering a mobile money / mobile banking solution? A bank A Mobile Network Operator A ‘3rd provider’ – providers of mobile money / mobile banking services, who use their own proprietary software and are neither a Mobile Network Operator or a bank
What services do you want to do?
Additional Resources: For further information on this and related topics visit the ‘IT-enabled solutions’ section on the Practitioner Hub for inclusive business at http:// businessinnovationfacility.org/ page/know-how-it-enabledsolutions USAID “Scaling Usage of Mobile Money to Boost Financial Inclusion in Malawi”: http://egateg.usaid.gov/ resources/1249 Finance Sector Deepening, Kenya “Why doesn’t every Kenya business have a mobile money account?”: http:// www.fsdkenya.org/pdf_ documents/12-04-20_Business_ uses_of_M-PESA.pdf Financial Sector Knowledge Share, US AID “Enabling Mobile Money Interventions Primer, Diagnostic Checklist, and Model Scopes Of Work”: http://pdf.usaid.gov/pdf_docs/ PNADW294.pdf Making Mobile Money Daily Relevant, Ignacio Mas: http:// papers.ssrn.com/sol3/papers. cfm?abstract_id=2018807
Disbursal of funds: loans, salaries, allowances, operational costs etc Collection of funds: retail payments, loan repayments, savings mobilisation Become an agent / develop an agent network
Is there a business case for using mobile banking / mobile money? Reduced costs of gaining new customers: lower capex and opex relative to increased outreach Clear cost/benefit analysis shows savings: e.g. cost of expansion via existing channels is greater than cost of expected cost of Alternative Delivery Channels. Reduced human resource costs or other cost savings Administration/data entry cost and time savings Staff efficiency
What new procedures need to be designed? Disbursal and collection of monies Reconciliation of accounts Monitoring and evaluation Audit / control Escalation procedures
What contracts need to be negotiated? Will any / all contracts be exclusive? Negotiate commercial terms, based on your expected roll out
Additionally, you should consider What reports are needed?
This Checklist was produced by Chris Statham, www. mobilemoneyconsultancy.com. It was developed as part of the work undertaken by the Business Innovation Facility with Rab Processors and the Agricultural Commodity Exchange in Malawi.
What co-branding will be done? What training, customer awareness will be done? Do there need to be changes to job descriptions? Do you have internal resource to manage the change process and/or do you need consultants? How, where and when will you do a pilot? Do you need an agent network?
The Business Innovation Facility (BIF) is a pilot project funded by the UK Department for International Development (DFID). It is managed for DFID by PricewaterhouseCoopers LLP in alliance with the International Business Leaders Forum and Accenture Development Partnerships. It works in collaboration with Imani Development, Intellecap, Renaissance Consultants Ltd, The Convention on Business Integrity and Challenges Consulting. The views presented in this publication are those of the author(s) and do not necessarily represent the views of BIF, its managers, funders or project partners and does not constitute professional advice. We welcome feedback on our publications – please contact us at
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October 2012
For further information and to view other Checklists, go to: Practitioner Hub on Inclusive Business: www.businessinnovationfacility.org
