Research & Analysis

Branchless Banking Diagnostic Template

Branchless banking is defined as the delivery of financial services outside conventional bank branches, often using agents and relying on information and communications technologies to transmit transaction details – typically card-reading point-of-sale (POS) terminals or mobile phones. It has the potential to radically reduce the cost of delivery and increase convenience for customers. Consequently, branchless banking can increase poor people’s access to financial services if regulation (i) permits the use of a wide range of agents outside bank branches, thereby increasing the number of service points, (ii) eases account opening (both on-site and remotely) while maintaining adequate security standards and (iii) permits a range of players to provide payment services and issue e-money (or other similar stored-value instruments), thereby enabling innovation from market actors with motivation to do so.

The purpose of this template is to aid diagnostic teams in developing a robust understanding of the regulatory and practical environment related to branchless banking in any given jurisdiction. It is intended to help these teams (i) understand applicable regulatory frameworks, (ii) identify current or potential restrictions on the growth of branchless banking and gaps in protection of customers or the integrity of the financial system, (iii) ascertain government and industry willingness to increase financial access to the poor and (iv) propose recommendations and solutions to facilitate branchless banking’s development as a means of extending financial services to the unbanked poor.