A new case study which outlines 10 strategic, operational and technical learnings that other finance and microfinance institutions can consider when creating or building a branchless banking solution in Afrika has been released. The case study was put together by FINCA International and Mastercard Foundation after they deployed FINCA's agency banking solution over the past 4 years on the continent.
With the aim of scaling up financial inclusion in Afrika, FINCA and the Mastercard Foundation have deployed various digital solutions, such as agency and mobile banking.
"Agent banking removes a lot of the logistical barriers that prevent people from fully leveraging the financial tools available to them. FINCA is now developing financial products and services to be delivered through this increasingly important channel," said Andrée Simon, CEO FINCA Impact Finance.
The idea behind agency banking is that a financial services institution will utilize a network of local merchants and shopkeepers, in areas where they don't have a presence. In turn, these merchants and shopkeepers provide basic financial and banking services. Typically, the agents are equipped with POS (Point of Sale) machines which securely connect to FINCA bank accounts, in this example. Apart from FINCA, another example of this is TYME (Take Your Money Everywhere).
"We're pleased to support FINCA as it expands agency banking to reach remote and underserved communities in Africa and offer critical banking solutions. This partnership shows that, by investing in agent networks and value-added services, financial service institutions can better serve their clients and help to close the gap of the financially excluded," said Sumaiya Sajjad, Program Manager at the Mastercard Foundation.
Since launching agency banking in the DR Congo in 2012, over 80 percent of all transactions by FINCA clients in that country are done through banking agents. FINCA has since expanded its agency banking model to Malawi, Nigeria, Tanzania, and Zambia, working with over 1,400 agents in the process.