Demand for mobile financial services in Nepal

Debbie Watkins, SBI’s Head, Implementation for Alternative Delivery Channels, was one of the key speakers at the Mobile Financial Services Summit hosted in Kathmandu, Nepal in June 2012.

The conference was organized by USAID Nepal through its Nepal Economic, Agriculture and Trade (NEAT) program in order to “set the stage for an interactive dialogue on how Nepal can successfully develop its mobile financial services sector and encourage further innovation in mobile money and branchless banking.”

Nepal, with a population of 27 million and a per capita income of less than US$650, is one of the least developed countries in the world. The country has seen modest development progress over the past 15 years: poverty rates have declined steadily; child mortality and tuberculosis infections have been reduced by half; and 90 percent of children are now initially enrolled in school. This development has also been reflected in the growth of the Nepalese financial sector – aided by recent developments in banking technology which have expanded banking from the traditional brick-and-mortar infrastructure of staffed branches to a system supplemented by channels such as automated teller machines (ATM), credit/debit cards, internet banking and online money transfers.

However, despite significant improvements, access to basic financial services is still restricted only to certain segments of the society. For the financially excluded, opening and maintaining bank accounts in Nepal can be complex and time-consuming due to lack of awareness, geographic inaccessibility, and low availability of targeted products.

The conference was attended by a large percentage of the banking community in Nepal, in addition to representatives from the South Asia region, and speakers traveled from as far away as Kenya and the United States to provide delegates with a wealth of useful and relevant information.

Debbie presented the results and conclusions from SBI’s NEAT-funded branchless banking demand research, conducted with 1,000 respondents from 10 districts throughout the country in order to:

  • Help understand the financial uses and demands of the target population
  • Identify areas that could potentially be addressed through mobile and branchless banking channels
  • Build industry understanding of how the target populations uses mobile phones
  • Assist financial institutions in Nepal to align their strategy for the development of mobile financial services in Nepal

Her presentation covered key elements of SBI’s report, which highlights the challenges faced by the Nepali population in gaining access to regulated and low-cost financial services, and the opportunities this presents for banks to launch a range of carefully-targeted products through branchless and mobile banking channels.

Please view this short video to see Debbie’s take on what is required to initially help build a market for mobile financial services in Nepal: 

 

 

 

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