Top 10 List: Powerful Partnerships in Branchless Banking

A few weeks ago in Washington, DC, we hosted many of our partners who are implementing branchless banking products and services around the world. This was a chance not only for us to learn about the state of play of the industry at a global level, but also to allow the partners themselves to share learnings and experiences with each other.

Is there something that a nonbank electronic money issuer in Burkina Faso can learn from a state-owned commercial bank in India? Is there cross-learning between a mobile network operator in Pakistan and a large retail chain in Mexico? We think so. Chances are these businesses have more in common than we might think at first glance, especially if their overall objective is to reach the unbanked through innovative uses of technologies and new business models.

One of the topics we discussed together was the keys to building powerful partnerships. No one can launch a branchless banking service alone. Either an MNO must partner with a bank to hold the float, or an agent network company must partner with an MNO to provide the transaction channel, or a bank must partner with an MNO to build an agent network, or… the list could go on and on. If one thing is crystal clear in branchless banking, it is that partnerships are critical and yet partnerships are difficult.

So we asked our partners to brainstorm together and give us their top 10 list of recommendations for building powerful partnerships based on their experiences that we could share with the global industry (that’s you!). Here’s what they came up with, organized in three loose categories:

Broad strategy and vision:

• Ensure that there is a long-term strategic alignment among partners with a shared common vision.
• Align specific incentives and expectations on financial returns among partners.
• Focus not only on commitment from top management but from the entire staff of an organization.
• Do not ignore the soft factors like cultural fit among partners.

Specific tactics:

• Clarify the business model for each partner and for the overall venture from the beginning. Ambiguity will only lead to confusion and  conflict later on.
• Agree on the scope of the opportunity and the value that partners are together trying to bring to the customer.
• Distinguish between what is a key partnership and what is simply a vendor or service provider. Identify which partnerships require dedicated time and energy.
• Specify up front the roles and responsibilities of each partner in terms of defined KPIs.

Damage control:

• Keep options open for other types of partnerships in case unexpected problems arise. 
• Establish a clear exit strategy if divorce is ultimately necessary. (But we hope it never is!)

What do you think? Do you agree with this list? What is missing from your experiences?