Postal financial services and mobile money: A tool for competitive advantage
1. Agency Proposal
Merchant and Agent Transaction
Services Ltd (MATS)
POSTAL FINANCIAL SERVICES AND MOBILEMONEY:
A Tool For Competitive Advantage.
Emmanuel Okoegwale
MobileMoneyAfrica
African Conference on
Remittances and Postal Networks
1
2. REMITTANCES AS ENTRY POINT ADVANTAGE
2
• Savings
• Increased productivity
• Microfinance
• Empowerment
• Insurance
• Payment services
African Conference on
Remittances and Postal Networks
3. Relevance of Postal Network to MobileMoney adoption
3
Wide coverage.
Urban and Rural reach and access.
Trusted in the communities.
Low value transactions can be
facilitated.
Local language support.
African Conference on
Remittances and Postal Networks
4. The remittance challenge in rural Africa
High transaction costs.
Limited rural payment networks.
Low financial literacy.
Poor consumer protection.
Challenging regulatory policies
– KYC, Transaction frequency etc
4African Conference on
Remittances and Postal Networks
5. The Missed Opportunity
5
POSTAL NETWORKS
AGENT AGENT AGENT
CONSUMERS CONSUMERS CONSUMERS
African Conference on
Remittances and Postal Networks
6. Hurdles to serving MobileMoney customers via Postal Networks
6
•E-float , Cash handling and management.
•Inadequate manpower and staffing.
•Technology and Network challenges in rural
communities.
•Low volume demand to justify investments.
•High Re-balancing cost.
African Conference on
Remittances and Postal Networks
7. What are the early lessons?
7
• Highly fragmented agency network all
across Africa.
• High cost of cash-out due to cost of
building and sustaining the agency
network.
• Rural populace paying extra under-
the-table fees to access funds from
their mobile wallet.
• The growth of mobilemoney is limited
and impacted with the limited size of
the agency network.
African Conference on
Remittances and Postal Networks
8. THE POSTAL REMITTANCE GAPS
8
• Connection to the national switching company /
provider.
-This limits the opportunity for timely switching,
reconciliations and settlement of transactions.
-Postal network also need to manage diverse e-
float account for different operators.
-Selective and exclusive partnerships.
• Infrastructure and Technology challenge.
African Conference on
Remittances and Postal Networks
9. Action plan
9
•Address the National regulation per country
•Reserve license for postal networks in each country.
•Cross regulator initiatives and better coordination within Government agencies
-Postal networks and authorities should be part of national initiatives for
financial inclusion, remittances etc
•Data access for planning purposes - Postal networks not being part of the
financial regulators plan, do not know areas of large in-bound remittances and
cannot plan with data for cash-out forecasting and access.
•Improved and aggregated applications - Build aggregated platforms to manage
diverse mobile money platforms and other remittances in-coming
•Top tier partnerships with Banks, providers, remittance providers etc
•Access to national switching firms for KYC checks, etc
African Conference on
Remittances and Postal Networks
10. CLEAR POLICY DIRECTIONS
10
• Postal network allowing multiple partnerships.
Improve competition.
Improve access.
Lower cost.
• Local currency cash-out.
• Explore mobile money integrations.
African Conference on
Remittances and Postal Networks
11. IMPACT ON RURAL POOR
• Reduced cost of transaction
• Timely cash out
• Reduce travel time to nearest cash-out point
• Improve productivity
• Increased GDP
• Better well being for rural population.
11