This post is written by Nicole Pasricha, Director of Inclusive Rural Finance in MEDA.
In Pakistan, UBL Omni has had measurable success in two key areas of branchless banking networks: driving usage and expanding agent points of service. By January 2012, just 21 months after the launch of the service, Omni had processed over $982 million dollars in bill payments and boasted an agent network of 6,500, of which a full 70% could be considered active.
But as a bank, usage of the system –especially through over-the-counter (OTC) transactions—was not enough. Omni wanted to encourage customers to open accounts, and move customers along a path towards more comprehensive branchless banking. Opening accounts would lead to more banked individuals, and would also help lower transaction costs for both Omni and the customer. Account usage was also important, since dormant accounts would not create any customer loyalty and wouldn’t help customers to move towards true mobile banking, in which customers perform their own transactions via mobile phone as opposed to traveling to the agent every time.
Omni identified incentives and engagement of agents and the Omni agent network staff team as the key ways to drive uptake in account opening amongst unbanked customers in Pakistan, and designed a strategy to accomplish this. The strategy has three main components:
1) Re-vamping incentives for Omni agent network staff team members: At Omni, a trained agent network staff team recruits new agents and provides them with ongoing support and troubleshooting. This team is thus the key communications channels for agents and has strong influence on the agent network, which is primarily made up of local retailers. The Omni team decided to improve the agent network staff commission to better reward network staff whose agents open Omni accounts and show high usage rates of the accounts.
2) Re-structuring account-opening and usage incentives for Omni agents: At the same time, Omni also reworked the agent commission fee structures to give higher commissions for account opening, and to include a “retention commission” that ensured that even as customers transitioned to mobile (self-conducted) transactions using their new Omni accounts, agents would continue to earn a percentage (between 10-20%) of the normal fee for that transaction, so that there would be no disincentives to promoting account opening to customers. Omni also announced special bonuses that will be rewarded over the next few months to those agents who are most successful in the account opening campaign.
3) Re-engaging Omni agents through half-day ‘engagement sessions’: The Omni team designed an agent engagement curriculum that would reinforce key messages about the agents’ important role in Omni and to communicate the revised and improved incentives structures for account opening and usage. They then gathered agents in groups of 100-150 to participate in half-day engagement events in key markets, led by experienced Omni facilitators and attended by agent network staff and senior managers from Omni’s regional offices. The sessions were structured to leave ample time for question-and-answer discussions– the first time that agents could voice their questions, concerns, and ideas amongst their peers and in front of Omni senior managers. Lunch and promotional items were also provided. The sessions were very well received by agents, and also included formal recognition of the best-performing agents in the region.
Over 3,500 agents have now participated in these engagement sessions all over the country. As a next step, these strategies will be supplemented by further above-the-line and below-the-line marketing campaigns, improved POS technologies, and outgoing call center customer engagement to encourage account usage and to get customer feedback on the products. Omni wants to open 100,000 new branchless accounts by June 2012 – we’ll be watching to see whether these new approaches to agents and agent network staff incentives and engagement can help to move Omni’s customers along a path to account-holding, repeat users of branchless banking services.