United Nations
Information Centre | Nepal
Potential Agents in Nepal
Abstract:
In Nepal, numerous financial institutions in a variety of forms—such as banks, savings and credit co-operatives (SACCOs) and micro-finance institutions—are engaged in expanding access to finance for the Nepalese people. Despite these efforts, a significant proportion of the population lacks access to finance. This gap is mainly due to low population density in several regions, challenging terrain and topography and poor infrastructure (roads, connectivity, telecommunication and internet service), all of which make greater access to finance difficult to achieve.In the past, the Government and private sector institutions conducted several studies to assess the need for financial services among low-income households in Nepal. In the wake of these studies, the Government and Nepal Rastra Bank have been proactively focused on paving the way for the financial sector to provide universal access. The potential customers and the financial sector have been at the centre of the focus on financial inclusion, with significant research, discussion and debate on the issues faced by customers. However, due emphasis has not been placed on the agents, who are and would be the most important cogs in the emerging financial services machinery. Currently, the number of agents serving the unbanked population pales in comparison to similar figures in mature mobile money markets such as Kenya or Bangladesh. Until now, there has been no design to agent selection. Rather, it has basically occurred by default, based on an expansion strategy in which anyone interested was selected as an agent. This gap has resulted in a mismatch of agents’ expectations and the value propositions offered by banks, which could lead to the dissatisfaction of agents in the medium and long term. In the interests of branchless-banking stakeholders, UNCDF through its MM4P programme commissioned this research to identify potential agents, the segments in which they operate and their motivations to become mobile banking agents. The research was undertaken with two key objectives:(1)to identify which businesses are suitable to be branchless banking agencies (2)to suggest an appropriate value proposition for each suitable business identified.
Publisher: MM4P/UNCDF Type / Script:
Progress Report  in  English
Keywords:
 VALUE CHAINS, FOCUSED GROUP DISCUSSION, GEOGRAPHY AND DEMOGRAPHY, FINANCING, SOCIAL INCLUSION, DEVELOPMENT, ADVANCEMENT, INTERNATIONAL FINANCIAL INSTITUTIONS, REVOLVING LOAN FUNDS, REVOLVING FUNDS, CREDIT UNIONS, INTERMEDIARIES, FINANCIAL INCLUSION, RETAILER'S CAPABILITY, PERSONAL INTERVIEWS, FINANCES, FINANCIAL COOPERATIVES, BANKS, SAVING AND CREDIT COOPERATIVES, LOW POPULATION DENSITY, PRODUCT ATTRIBUTE RANKING, RELATIVE PREFERENCE RANKING, REMITTANCE AGENTS
Thematic Group:
UNCDF, (2014)
Thesaurus:
02.11.00 - Banking And Investment
PDF | File Size: 9.19 MB   Download
Feeder: DEEPIKA DHAKAL, Editor: BIMBIKATHAPA@GMAIL COM, Auditor:
...
Potential Agents in Nepal
Abstract:
In Nepal, numerous financial institutions in a variety of forms—such as banks, savings and credit co-operatives (SACCOs) and micro-finance institutions—are engaged in expanding access to finance for the Nepalese people. Despite these efforts, a significant proportion of the population lacks access to finance. This gap is mainly due to low population density in several regions, challenging terrain and topography and poor infrastructure (roads, connectivity, telecommunication and internet service), all of which make greater access to finance difficult to achieve.In the past, the Government and private sector institutions conducted several studies to assess the need for financial services among low-income households in Nepal. In the wake of these studies, the Government and Nepal Rastra Bank have been proactively focused on paving the way for the financial sector to provide universal access. The potential customers and the financial sector have been at the centre of the focus on financial inclusion, with significant research, discussion and debate on the issues faced by customers. However, due emphasis has not been placed on the agents, who are and would be the most important cogs in the emerging financial services machinery. Currently, the number of agents serving the unbanked population pales in comparison to similar figures in mature mobile money markets such as Kenya or Bangladesh. Until now, there has been no design to agent selection. Rather, it has basically occurred by default, based on an expansion strategy in which anyone interested was selected as an agent. This gap has resulted in a mismatch of agents’ expectations and the value propositions offered by banks, which could lead to the dissatisfaction of agents in the medium and long term. In the interests of branchless-banking stakeholders, UNCDF through its MM4P programme commissioned this research to identify potential agents, the segments in which they operate and their motivations to become mobile banking agents. The research was undertaken with two key objectives:(1)to identify which businesses are suitable to be branchless banking agencies (2)to suggest an appropriate value proposition for each suitable business identified.
Publisher: UNCDF Type / Script:
Progress Report  in  English
Keywords:
 VALUE CHAINS, FOCUSED GROUP DISCUSSION, GEOGRAPHY AND DEMOGRAPHY, FINANCING, SOCIAL INCLUSION, DEVELOPMENT, ADVANCEMENT, INTERNATIONAL FINANCIAL INSTITUTIONS, REVOLVING LOAN FUNDS, REVOLVING FUNDS, CREDIT UNIONS, INTERMEDIARIES, FINANCIAL INCLUSION, RETAILER'S CAPABILITY, PERSONAL INTERVIEWS, FINANCES, FINANCIAL COOPERATIVES, BANKS, SAVING AND CREDIT COOPERATIVES, LOW POPULATION DENSITY, PRODUCT ATTRIBUTE RANKING, RELATIVE PREFERENCE RANKING, REMITTANCE AGENTS
Thematic Group:
UNCDF, (2014)
Thesaurus:
02.11.00 - Banking And Investment
PDF | File Size: 9.19 MB   Download
Feeder: DEEPIKA DHAKAL, Editor: ALISHATHAPALIYA, Auditor:
...
Potential Agents in Nepal
Abstract:
In Nepal, numerous financial institutions in a variety of forms—such as banks, savings and credit co-operatives (SACCOs) and micro-finance institutions—are engaged in expanding access to finance for the Nepalese people. Despite these efforts, a significant proportion of the population lacks access to finance. This gap is mainly due to low population density in several regions, challenging terrain and topography and poor infrastructure (roads, connectivity, telecommunication and internet service), all of which make greater access to finance difficult to achieve. In the past, the Government and private sector institutions conducted several studies to assess the need for financial services among low-income households in Nepal. In the wake of these studies, the Government and Nepal Rastra Bank have been proactively focused on paving the way for the financial sector to provide universal access. The potential customers and the financial sector have been at the centre of the focus on financial inclusion, with significant research, discussion and debate on the issues faced by customers. However, due emphasis has not been placed on the agents, who are and would be the most important cogs in the emerging financial services machinery. Currently, the number of agents serving the unbanked population pales in comparison to similar figures in mature mobile money markets such as Kenya or Bangladesh. Until now, there has been no design to agent selection. Rather, it has basically occurred by default, based on an expansion strategy in which anyone interested was selected as an agent. This gap has resulted in a mismatch of agents’ expectations and the value propositions offered by banks, which could lead to the dissatisfaction of agents in the medium and long term. In the interests of branchless-banking stakeholders, UNCDF through its MM4P programme commissioned this research to identify potential agents, the segments in which they operate and their motivations to become mobile banking agents. The research was undertaken with two key objectives:(1)to identify which businesses are suitable to be branchless banking agencies (2)to suggest an appropriate value proposition for each suitable business identified. The research covered 21 districts in fve development regions of Nepal. During the research, the team covered 346 customers and 114 businesses, using 4 different qualitative research tools: focus-group discussions, personal interviews, product attribute ranking and relative preference ranking. With the objective of mapping the functions of branchless banking for those in existing businesses and designing appropriate value propositions, the research team studied the remaining businesses in detail. The team concluded that, in the case of SACCOs, remittance agents and ready made garment shops, banks will have to either manage potential agents directly or through bank-appointed master-agents, since there is no significant value chain. In the case of grocery, medicine and agri-input businesses, a few functions such as monitoring and liquidity could be delegated to distributors. As far as value propositions for them are concerned, banks will do better to consider them first as their customers and, as such, provide them with attractive propositions in addition to the potential revenue they would earn as agents. This report details customized value propositions for each of the six businesses that were studied in detail. To summarize, banks will have to consider their own business models and limitations before expanding their agent network by means of a suitable value chain. Banks that have a large number of branches in remote areas could use remittance agents or SACCOs as branchless banking agents, as they could be monitored by regional branches.
Publisher: MM4P, UNCDF Type / Script:
Progress Report  in  English
Keywords:
 VALUE CHAINS, FOCUSED GROUP DISCUSSION, GEOGRAPHY AND DEMOGRAPHY, FINANCING, SOCIAL INCLUSION, DEVELOPMENT, ADVANCEMENT, INTERNATIONAL FINANCIAL INSTITUTIONS, REVOLVING LOAN FUNDS, REVOLVING FUNDS, CREDIT UNIONS, INTERMEDIARIES, FINANCIAL INCLUSION, RETAILER'S CAPABILITY, PERSONAL INTERVIEWS, FINANCES, FINANCIAL COOPERATIVES, BANKS, SAVING AND CREDIT COOPERATIVES, LOW POPULATION DENSITY, PRODUCT ATTRIBUTE RANKING, RELATIVE PREFERENCE RANKING, REMITTANCE AGENTS
Thematic Group:
UNCDF, (2014)
Thesaurus:
02.11.00 - Banking And Investment
PDF | File Size: 9.19 MB   Download
Feeder: DEEPIKA DHAKAL, Editor: , Auditor:
...
Potential Agents in Nepal
Abstract:
In Nepal, numerous financial institutions in a variety of forms—such as banks, savings and credit co-operatives (SACCOs) and micro-finance institutions—are engaged in expanding access to finance for the Nepalese people. Despite these efforts, a significant proportion of the population lacks access to finance. This gap is mainly due to low population density in several regions, challenging terrain and topography and poor infrastructure (roads, connectivity, telecommunication and internet service), all of which make greater access to finance difficult to achieve. In the past, the Government and private sector institutions conducted several studies to assess the need for financial services among low-income households in Nepal. In the wake of these studies, the Government and Nepal Rastra Bank have been proactively focused on paving the way for the financial sector to provide universal access. The potential customers and the financial sector have been at the centre of the focus on financial inclusion, with significant research, discussion and debate on the issues faced by customers. However, due emphasis has not been placed on the agents, who are and would be the most important cogs in the emerging financial services machinery. Currently, the number of agents serving the unbanked population pales in comparison to similar figures in mature mobile money markets such as Kenya or Bangladesh. Until now, there has been no design to agent selection. Rather, it has basically occurred by default, based on an expansion strategy in which anyone interested was selected as an agent. This gap has resulted in a mismatch of agents’ expectations and the value propositions offered by banks, which could lead to the dissatisfaction of agents in the medium and long term. In the interests of branchless-banking stakeholders, UNCDF through its MM4P programme commissioned this research to identify potential agents, the segments in which they operate and their motivations to become mobile banking agents. The research was undertaken with two key objectives:(1)to identify which businesses are suitable to be branchless banking agencies (2)to suggest an appropriate value proposition for each suitable business identified. The research covered 21 districts in fve development regions of Nepal. During the research, the team covered 346 customers and 114 businesses, using 4 different qualitative research tools: focus-group discussions, personal interviews, product attribute ranking and relative preference ranking. With the objective of mapping the functions of branchless banking for those in existing businesses and designing appropriate value propositions, the research team studied the remaining businesses in detail. The team concluded that, in the case of SACCOs, remittance agents and ready made garment shops, banks will have to either manage potential agents directly or through bank-appointed master-agents, since there is no significant value chain. In the case of grocery, medicine and agri-input businesses, a few functions such as monitoring and liquidity could be delegated to distributors. As far as value propositions for them are concerned, banks will do better to consider them first as their customers and, as such, provide them with attractive propositions in addition to the potential revenue they would earn as agents. This report details customized value propositions for each of the six businesses that were studied in detail. To summarize, banks will have to consider their own business models and limitations before expanding their agent network by means of a suitable value chain. Banks that have a large number of branches in remote areas could use remittance agents or SACCOs as branchless banking agents, as they could be monitored by regional branches.
Publisher: MM4P, UNCDF Type / Script:
Progress Report  in  English
Keywords:
 VALUE CHAINS, FOCUSED GROUP DISCUSSION, INTERNATIONAL FINANCIAL INSTITUTIONS, REVOLVING LOAN FUNDS, REVOLVING FUNDS, CREDIT UNIONS, INTERMEDIARIES, FINANCIAL INCLUSION, RETAILER'S CAPABILITY, PERSONAL INTERVIEWS, FINANCES, FINANCIAL COOPERATIVES, BANKS, SAVING AND CREDIT COOPERATIVES, LOW POPULATION DENSITY, PRODUCT ATTRIBUTE RANKING, RELATIVE PREFERENCE RANKING, REMITTANCE AGENTS
Thematic Group:
UNCDF, (2014)
Thesaurus:
02.11.00 - Banking And Investment
PDF | File Size: 9.19 MB   Download
Feeder: DEEPIKA DHAKAL, Editor: , Auditor:
...