Searching for Success Stories in Banking Beyond Branches

This is a guest blog by Mireya Almazán & Ignacio Mas from the Bill & Melinda Gates Foundation. The GSMA Mobile Money for the Unbanked also recently posted a blog from Mireya and Ignacio about their new initiative discussed here.

Who would have expected only three years ago that banking beyond branches would be receiving so much attention across the financial services and development industries? New deployments are popping up globally—over 30 were launched last year alone. While this level of attention and pace of activity is very welcome, keeping track of them all and identifying the promising ones is getting difficult. Part of our job at the Financial Services for the Poor (FSP) team at the Bill & Melinda Gates Foundation is to promote industry leaders and spread good practices. Rather than falling into the trap of only talking about those that we know about, or those that are getting the most press, we thought we’d be explicit about what is our vision of success, and have you tell us whether you are already there. The Bill & Melinda Gates Foundation wants to showcase you.

What’s particularly exciting for us is to see so many different approaches being employed, leveraging partnerships between a wide range of players. While mobile network operators have introduced mobile money services that are proving to be game-changing for financial services in many countries, banks are also taking bold steps to redefine themselves, introducing new business models that can work for poor people at scale. Increasingly, we are seeing banks move away from traditional float- and credit-based revenue models to transaction-based schemes that are more appropriate for the cash flows of poor people. Moreover, banks are shifting the bulk of low-value transactions to a much lower-cost and more ubiquitous retail channel, which adds much convenience to customers and makes for a significantly more compelling business case to serve poor people with savings services. Banking beyond branches will not just involve competition between institutions, but also competition between partnership and business models.

If you are a financial institution, mobile operator, or third party marking progress to expand financial access, we want to learn from your experiences and showcase your success. For this purpose, we have just issued a call to showcase promising deployments in banking beyond branches, with two categories of success. The first, the Bridges to Cash showcase, will recognize players who have built a dense and sustainable network of cash merchants where people cash-in and cash-out conveniently from their electronic accounts. We are looking for schemes where the number of cash merchants is at least 10 times the number of bank branches of the largest bank in the country where it operates, and the average number of transactions per cash merchant per day is at least 30.

The second, the Digital Piggy Bank showcase, will recognize players who successfully market the account for reasons beyond making payments—those that can most likely lead to safe places to save. Here we are looking for schemes that can demonstrate the account is being used as a store of value, with at least 100,000 customers with a non-zero balance in their electronic accounts, and have these meet specific criteria around account usage. More details on the criteria for these showcase opportunities are available here.

If you meet these criteria, let us know at FSPShowcase@gatesfoundation.org. We don’t offer any prize or financial incentive, we are offering only publicity, an opportunity to feel good, maybe if we get sufficiently organized a plaque to hang on your wall, and some bragging rights. The first set of companies that claim success will be showcased at the World Economic Forum (WEF) Africa Summit in May, but for that we’ll need to hear from you by March 26, 2011.

Let us do the boasting about your successes. You can have much indirect impact globally by inspiring others to tackle the problem of financial exclusion.