Checking in on CGAP and Branchless Banking

When I heard that Gautam Ivatury of CGAP would be at NYU’s “From Innovation to Impact” Conference, I thought it would be a great time to follow up with my previous interview with him. While he did not have time to talk today, we are going to schedule a follow up soon. Nevertheless, I was able to listen to his presentation on what CGAP has been doing to help move the market to be more amenable to branchless or mobile banking.

Here are a couple highlights from his talk, but stay tuned for a more in depth interview in the coming weeks.

• The most interesting point raised was the importance of centering the business plan around the potential agents. In essence, branchless banking would operate in the same way people currently refill their cell phones throughout India. A shopkeeper, authorized by a bank or cell phone company to accept withdrawals and deposits, would receive an SMS or some other communication from a customer’s phone and then either accept the deposit or disburse cash. Ivatury emphasized that such models have only been successful when it is designed to ensure that it is profitable and worthwhile for these agents themselves — a point, while obvious, can be easily overlooked by a major player.

1. Ivatury also commented on the process of actually “moving the market” — or getting the greater financial community on board and outlined the process as such:Research and Information — first find the data that must be presented
2. Synthesis — analyze the data in a way that is clear and concise
3. Communicate — get mainstream media, like the Economist or Financial Times, to pick it up
4. Influence — once major players are aware, bring them together through events to persuade them to adopt it
5. Market Changes