XacBank
Name of project: Nomadic Banking
Project partner: XacBank
Country: Mongolia
Coverage: National
Date began: April 2008
Technology used: Mobile channels, SMS in the 1st phase, menu-based applications in the 2nd phase
Services: Branchless banking services through cell phones and cash-handling agents
Clients: Targeting 300,000 customers, including nomadic groups |
About the project
XacBank, the Ulaanbaatar-based community development bank and microfinance institution, launched a new mobile banking service in July 2009. Named AMAR (EASY in Mongolian), it is a technology-based service that creates an opportunity for people to have full financial services in a convenient, reliable, and cost effective way in remote and urban areas of Mongolia. The service is available to users through mobile phones and cash handling agents.
In a sparsely-populated country like Mongolia, delivering financial services throughout the country has always been a challenge. XacBank sees mobile banking as a new way to reach unbanked people, as well as a way to reduce the bank’s operational costs and provide its existing customers with more convenient and easier ways to manage their money.
The development and use of up-to-date technology is one of the main drivers behind the success of any m-banking system. XacBank uses the software Noomadic, developed by Horus Nomadic Solutions, and is being rolled out in three phases. The first phase is operational and uses an SMS-based interface to handle large transaction volumes. For AMAR users, the SMS interface is easy to use and does not require a sophisticated, expensive handset.
Phase 2 aims to create a Java application in order to make AMAR services even more user-friendly and less time consuming. When Phase 2 is in place, users will be able to use AMAR to manage a second XacBank account, including a loan account to facilitate loan repayments. The development of the Java application is completed and is now being tested by the bank. Phase 3 will enable utility bill payments and other services.
Currently, AMAR provides its users the ability to do cash deposits and withdrawals, person-to-person transfers, payments, balance inquiries, and mini statements. In order to widen its existing agent network, XacBank has partnered with Petrovis, Mongolia’s biggest petroleum company.
Status of project
As of April 2010, there are over 35,000 AMAR customers transacting at 2,500 agent locations. Out of these, 25,000 customers and 1,620 agents are in rural locations.
For more information please write to us at technology@cgap.org.
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