Leveraging Innovative Tech For Efficient Agent Networks

 A joint brief by the Center for Financial Inclusion at Accion and the Institute of International Finance remarks technological innovation can be a potential driver for improving the efficiency of agents for customers and themselves. 

Agent networks help financial services reach underserved areas. In 2017 alone, the number of registered mobile money agents increased by 17% worldwide, reaching a total of 5.3 million. However, only 55% of these agents are active. 

 A joint brief by the Center for Financial Inclusion at Accion and the Institute of International Finance remarks technological innovation can be a potential driver for improving the efficiency of agents for customers and themselves. 

Different technologies can be used to address the challenges faced by financial institutions, agents, and customers in building and managing agent networks. 

Financial institutions

Several institutions that were interviewed had outdated and decentralized IT systems that necessitated redundant efforts to carry out transactions. Furthermore, the process of bringing new agents onboard can be burdensome. Monitoring the performance of agents can also be overwhelming if data collection and quality control mechanisms are not in place. 

Innovative technologies can respond to these challenges by streamlining IT infrastructure, digitizing processes, leveraging data analytics, and offering diverse products more efficiently. Integrating technology into a broader business case is key to the success of an agent banking initiative.

PaperSoft, a Portugal-based company, uses smart forms to rapidly and securely capture agent eligibility information and outlet conditions. This facilitates onboarding and reduces operational costs. 

Artoo, an India-based platform provider, enables financial institutions to offer credit via agents to unbanked customer segments quickly and seamlessly

Agents

Agents operate in a complex environment full of customer education, marketing, connectivity, cash flow and liquidity challenges. They need to feel that the financial institutions they represent are committed to keeping them profitable and relevant amid these challenges they face. 

In Nigeria, new FirstBank agents undergo a two-week probation period during which their activity is monitored using data analytics. Agents who complete a certain volume of transactions are rewarded with a POS device. 

Digital technology-based learning platforms can be used to educate agents and customers. e-learning platforms reduce costs associated with traditional physical training. 

Stanbic Bank Uganda uses social media to build customer awareness about its agent network. The bank launched a campaign, promoted on its Facebook page, that rewards customers for completing digital transactions. 

Customers 

Customers use agent points when financial institutions are not nearby, but could be directed from one agent to another for various reasons, including the unavailability of cash. Technologies that provide real-time agent locations and working hours can help customers find the closest available agent. Customers may also mistrust agents and risks of fraud can be high, hence building consumer protection is essential.

Biometric-based identification systems reduce customers’ burden to prove their identity, reduce fraud, and improve operational efficiency.

The report predicts the future of financial services is digital and cash-lite, with agents evolving from transaction processors to customer touchpoints and solution providers. 

Read the full report here.

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