Page 31 - State-of-the-Industry-2013

Part 1 - mOBile mOney

• Retraining inactive agents: Some agents may become inactive because they do not understand the service and its business model
well enough. in this case, retraining inactive agents could be helpful. (See text box 7 about the importance of agent training and
how mtn uganda communicates with its agent network.)

• Cutting inactive agents: Finally, mobile money providers should consider cutting some of their inactive agents. Several sprinters
have already dismissed some of their agents and/or master agents, and three others were planning to do so when we interviewed
them earlier this year. reasons for dismissal included not only KyC infringements and fraudulent activities, but also low performance
(based on the agents’ transaction volumes and revenues) and branding infringements. While cutting an agent base may seem
complicated, in the long run it is a better option than having inactive agents. 23

TexT BOx 6
enabling Data-Driven Decisions to exPanD agent
networks in keY areas*

Traditional access measures are very general – like the number of bank branches per 100,000 people for the entire country. But these
measures do not give any indication of where people live in relation to fnancial service access points (Bank Branches, ATMs, Mobile
Money Agents, Post Ofces, etc.). Over the past year, at the Financial Services for the Poor programme (FSP) from the Bill & Melinda gates
Foundation, we have worked with our partners to develop a set of resources to more accurately measure and track fnancial access.

We captured two main sets of data to create this tool. The frst is detailed fnancial access point locations, including Commercial
bank branches, ATMs, Micro-Finance Institutions, Mobile Money Agents, Savings and Credit Cooperatives Organizations, and
Micro-Finance Deposit Taking Institutions. The other is a high-resolution population map that includes poverty densities and other
demographic attributes. The population and poverty data are developed to a 1-kilometer resolution.

Once the two sets of data were captured and developed, it was time to put them to use. We used the population within 5km of an
access point as our base measurement – and ran the analysis in Nigeria, Tanzania, and Uganda. Our fndings show that between 28
and 48 percent of populations in these countries live within 5km of a fnancial access point of some type. Not surprisingly, the data
show lower fnancial access for poor people living under less than $2/day. In Uganda ~43% of the entire population, and only 34%
of the poor population, live within a 5km radius to a fnancial access point. Another interesting fnding is the discrepancy of access
between urban and rural populations. In Tanzania, 97 percent of the urban population lives within a 5km radius to a fnancial access
point while only 12 percent of the rural population lives within a 5km radius to a fnancial access point. This compares well with the
Global Findex data which shows that only 17 percent of the Tanzanian adult population has an account at a formal fnancial institu-
tion. In Nigeria, a country of 150 million people, there are less than 16,000 access points and only 22 percent of the rural poor lives
within a 5km radius to a fnancial access point.

The data clearly highlight gaps in access, but in doing so also provide critical insight into how countries can best address those gaps.
Fspmaps.com is thus a potentially powerful and supportive tool which countries can employ in the service of achieving their poverty
reduction goals. With this information, central banks, fnancial service providers, mobile network operators and other types of
fnancial service providers can adapt policy and business practices to close gaps and they have already started.

Following in-country events where we shared the results of this project, several Central Banks have taken action to build upon the
initial work by collecting additional data, dedicating organizational capacity to lead fnancial inclusion activities within their coun-
tries. Central Banks have also indicated an interest in amending policy to increase the role of digital money in expanding fnancial
access for the poor. This is a positive start to a lengthy process of improving fnancial inclusion.

The long-term vision of Fspmaps.com is to have it become a public good which goes beyond serving as a tool to the fnancial inclu-
sion feld. It holds great potential to be expanded and used to improve management information systems of ministerial entities and
local governance. Furthermore, the tool can become useful for donors and commercial players, including those involved in agricul-
ture; health and fnancial services; mobile telephone services; and even fast moving consumer goods companies.

* This text box is based on a blog post by Karina Nielsen (Bill & Melinda Gates Foundation) published on the MMU website on July 31, 2013

23. these insights were initially published as part of a blog post by Claire Pénicaud on the mmu website, “Should you be cutting your inactive agents?” (march 28, 2013), available at
http://www.gsma.com/mobilefordevelopment/should-you-be-cutting-your-inactive-agents
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