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December 2009
Branchless Banking
Godfrey Supka, Regional Manager Asia
Fern Software Established 1979
Range of implementations:
Microfinance
Credit Unions & SACCOs
Development Banks
Banks
Fern numbers:
Over 300 implementations
Installed in over 40 countries
Products in over 5 languages
World Market
TerminologyMobile Money
Mobile Payments Mobile Banking
Branchless Banking
‘While there have been successes stories around mobile
payments, we have yet to see financial services delivered
through branchless banking in significant way’
Xavier Faz.
CGAP Focus Note “Banking on Mobiles: 2009
MFI Business Case1. Increase Outreach
“Increase access to formal financial services”
2. Reduce Cost
.... At the same time
‘Financial services to the poor needs to get out of the banking hall.’
Bob Christen,
Cost Reduction - Bank/MFI Peru
banking hall vs. mobile phone
Down from 85 cents to 32 cents
and Money Philippines
Costs 5 times lower
. Pakistan
mobile agent vs. branch
Set up costs – 30 times lower
Running costs – 90 times lower
Cost Reduction - Client “The cost is not just the fee but the total cost in terms of
time to travel, to queue, the lost earnings and the potential risks.” Claire Alexandre,
“For each $1 it costs the bank to accept a deposit, the cost for the client is $1-5 to make that deposit, including transport costs and waiting time.” Bob Cristen,
agent banking with stores
Total client costs down 99 per cent on average
(61 pesos to 50 centavos)
Time spent was down from six hours to 30 minutes.
MIS RoleChallenges
Branchless Banking must be real-time
...but
Communications infrastructure is not robust and reliable
Solution
Use what is available
GSM network (2G) – GPRS
Message-based connectivity – “store and forward”
low-cost, standard, mobile phone interface
Example Configuration
Via robust internet
(e.g. ADSL, V-Sat)
and VPN
Real-time transaction transfer
National payments
clearing network
Internet
MFI MIS or Core Banking System
Abacus switch
(UT Route)
Centralised
branch
De-Centralised
branch
GSM mobile
phone
networks (2G)
Via GPRS
Existing ATM
networks
On-line units
Real-time access to MIS
Off-line units
Centralised
branch
Centralised
branch
Agent
Field officer
