agent banking

presentation is designed and prepared by Arif Hasan Khan

Presentation on

Group Name: Catalyst1. Md. Arif Hasan Khan2. S. M. Shalahuddin Ahmed3. Md. Aminul Islam 4. Md. Mahfuz Bin Bakhtiar5. Md. Rasheduzzaman6. Md. Meftaul Zinnah7. Md. Hasan Majumdar8. Md. Mahfizur Rahman

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At a glance

Financial Exclusion

Financial Inclusion

Agent Banking

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Financial Exclusion

Financial Exclusion

No Savings

No Insurance

No access to money advice

No affordable credit

No bank account

No assets

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Drivers of Financial Exclusion

• Drivers of financial exclusion Most Frequent: Low income, Nil or Low

savings, Lack of assets, Unemployment, Use of inappropriate products

Less Frequent: Psychological/disability issues, Feeling of being excluded, Indigenous /Ethnic issues, Geographical remoteness, Lack of PC/Internet Access.

• Personal and Social Factors:Cultural norms, Gender, Age, Legal identity.

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Financial Inclusion Definition

“The process of ensuring access to financial services and timely and adequate credit where needed by vulnerable groups such as weaker sections and low income groups at an affordable cost”

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Steps of rural development

Enthusiasm

Will

Skills

Implementations

Networking

Modernization

•Threats •Opportunities

• Commitment

•Basics•Programs•Technology

• New Work Cultures

•Cooperation•Purchasing•Production•Marketing•Selling

•Cooperation •Contents•Benefits

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Mahfuz Bin Bakhtiar

Bearing Id: 0921023

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presentation is designed and prepared by Arif Hasan Khan

Financial Inclusion – What exists and lacking

Steps Taken

Cooperative Movement

Nationalization of Banks

Lead Bank Scheme

Service Area Approach

What was Lacking

Absence of Modern Technology

Inadequate reach and coverage

Delivery Mechanism

Well defined business model

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Why we are talking of Financial Inclusion Now?

Focus on Inclusive Growth

Banking Technology has arrived

Realization that poor is bankable

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Data Flow Block Diagram of Financial Inclusion

-Account Opening

-Transactions

Data CapturedThrough Laptop

& POS/POT

Service provider

Intermediate Server

Security Equipment

INCB

Server

Activity is performed by BC

- Laptop for A/C opening

- POS/POT for transaction

Service provider’s

(Intermediate server File

converted into format of CB)

Villages

Data is uploaded into CB server and Interest Calculation done centrally and details sent back to POS and interested to the smart card of customer.

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Md. Rasheduzzman

Bearing Id: 0921047

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BASIC CHALLENGES OF FINANCIAL INCLUSION

• Coverage • Access to Diversified Financial Products and

Services• Delivery Model – Day to Day Transactions• Cost-Effective Technology• Customer education/financial advice• Change in banker’s mindset

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Problems / Difficulties

• Scaling up of activities• Appropriate business model yet to evolve• BC model too restrictive • Limitation of cash delivery points• Lack of interest / Involvement of Big

Technology Players

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Mahfizur Rahman

Bearing Id: 0921080

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Precondition for success

• Attitude and will power• Technology • Delivery Mechanism• Support Services

Infrastructure Community development support Product Innovation

Regulatory and Policy Interventions Involvement of all

Especially Development / Administration District / Block Village Level

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PREREQUISITES FOR THE SUCCESS OF FINANCIAL INCLUSION

• Appropriate Technology • Appropriate and Efficient Delivery Model • Mainstream bank’s determination and

involvement • Strong collaboration among banks, technical

service provider.

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Md. Aminul Islam

Bearing Id: 0921021

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• The agent banking model is designed to assist banks to lower their cost of offering banking services that has been a major impediment to inclusion while at the same time improving their earnings as more peoples are offered an opportunity to access financial services.

Agent Banking

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Delivery channels of Agent Banking

POS-enabled bank agent : • This is an agent managed by a bank that uses a payment card to identify customers.

Mobile phone-enabled agent: • This is an agent managed by a bank that uses a cell phone to identify customers.

Mobile wallet: • This is an agent that is often managed by a telecom.

Bank-provided account linked to a mobile wallet:

• This is a bank account that is linked to a mobile wallet.

Our analysis focuses on four types of agent banking delivery channels:

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Who can be an Agent of Agency Banking

pharmacies supermarkets convenience stores lottery outlets

post offices

Banking agents can be

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Agent Selection Criteria

The following issues should be taken into consideration for selecting agents:

•Competence to implement and support the proposed activities

•Financial soundness and cash handling capability;

•Ability to meet commitments under adverse conditions

•Business reputation

•Ability to offer technology based financial services

•Security and internal control, audit coverage, reporting and monitoring capacity

•Loan defaulter or the convicted person can not apply for agency ship

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Md. Meftaul Zinnah

Bearing Id: 0921051

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Transaction process

• Client withdraws money (“cash-out” transaction): agent account is credited in same amount.• Client deposits money (“cash-in” transaction): agent account is debited in same amount.

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Financial services offered by banking agents in various countries:

• Loan Payments• Withdrawals• Execution of collection services• Receiving and forwarding loan requests and financing

requests• Deposits to a customer’s or third party’s account• Opening and closing of simplified bank accounts

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• Payments on goods or services• Purchase of pre-paid debit cards• Balance inquiries• Bank statements• Transfers of funds between parties• Receiving and forwarding credit card applications

Financial services offered by banking agents in various countries:

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Hasan Majumdar

Bearing Id: 0921077

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Models used to manage banking agent networks

Financial Institution

Management Company

Agent Agent Agent Agent

Financial Institution

Agent Agent Agent Agent

Direct Model

Indirect Model

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Challenges & Threats of agent banking in Bangladesh:

• Insufficient volume of transactions• Lack of customer awareness • Infrastructure development and coverage • ICT platforms and sharing arrangements • Pricing and accessibility • Liquidity management • Threat of robbery is high

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• the economy is largely cash-based• The bank charges high fees for this service, adding substantially to the

costs of agents • the volume of transactions conducted through agents remains fairly low• The regulation does not allow banks to acquire new clients through

agents• very difficult to ensure agent banking systems work in the very remote

areas• Agents who are skilled enough to implement the payment system may

also be savvy enough to manipulate it.

Challenges & Threats of agent banking in Bangladesh:

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Md. Shalahuddin Ahmed

Bearing Id: 0921016

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Advantages of Agent Banking

• To achieve growth and equity• Get rid of poverty• To attract global market players to our country• To increase the employment and business

opportunity• To baring more transparency in the system

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Conclusion

• Financial inclusion by agent banking is a win-win situation for the financially excluded, corporates, the govt. and the Banks.

• Bankers can support by financing the agri products including their preservation and sales.

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• Easy to Banking services and products including consumer loans and micro-finance services

• Easy access and spread by agent banking of credit cards, debit cards etc. Bill payments of electricity, utilities etc.

Conclusion

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Md. Arif Hasan Khan

Bearing Id: 0921036

Last Presenter

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Decision

• Bangladesh stands second among South Asian nations in ensuring access to financial services for its citizens, a recent study found.

• Economic growth of a country plays a pivotal role for greater financial inclusion, and it is possible by agent banking in our country.

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• Around 66 percent of the households in Bangladesh now have access to services including credit, savings and insurance from banks or microfinance institutions (MFIs) and cooperatives

Decision

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• So we can say that agent banking can be a new era of Bangladesh for financial inclusive.

• It is a new mechanism for money create and transaction.

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That’s all for the time being

Everybody

presentation is designed and prepared by Arif Hasan Khan