The Digital Landscape of the Partnership for Responsible Financial Inclusion

The Digital Landscape of the Partnership for Responsible Financial Inclusion (PRFI) Inaugural Member Survey Digital Financial Services Peer Group Survey, 2017

Table of Contents Acknowledgements 3 Executive Summary 4 Introduction 5 Digital Innovations in the PRFI 5 Digital Footprint of PRFI Members 6 Target Segments 6 Geographical Concentrations 7 Products & Services Offered 8 Delivery Channels Used 9 Key Findings from the Research 10 Focus on Financial Literacy 11 On Client Protection 11 Innovation: Digitization and Data Analysis 12 Human Interaction 12 Opportunities for Collaboration 12 Conclusion 12 Practitioner Profile 14 Appendix 16 Online Survey Questions 16 Peer Group Interview Questions 19 Local Partner Interview Questions 19

Table of Figures Figure 1 : Target Segments Figure 2: Location of PRFI Members’ Digital Initiatives Figure 3: Type of Service Figure 4: Type of Product Figure 5: Type of Channel used Figure 6: The Diamond Bank Case

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6 8 9 9 10 14

Acknowledgements Project Directors Sharlene Brown, Executive Director, PRFI Bridget Dougherty, Project Manager, PRFI

Research Team Fernando Morales, Research & Data Management Intern, PRFI Kaede Kawauchi, Research & Data Management Intern, PRFI Survey Participants Prateek Shrinivastava † Accion Santhosh Thiruthimana † Aga Khan Agency for Microfinance Mayank Mathur Aye Finance Sahed Shams Azad † BRAC Melch Muhame Natukunda CARE Noeline Nakibuuka CARE Mwimbe Fikirini CARE Grace Majara CARE Innocent Rutikanga † CARE Olukayode Olubiyi Diamond Bank Christian Loupeda † Grameen Foundation Rosa Wang † Opportunity International Samantha Akins Pro Mujer Tom Allen † VisionFund International Amanda Kamin VisionFund International Santiago Mosquera VisionFund International Anjali Banthia Women’s World Banking Meghan Flaherty Women’s World Banking Diana Gooley † Women’s World Banking Shilpi Shastri Women’s World Banking Ryan Newton Women’s World Banking Jennifer McDonald † Women’s World Banking †PRFI DFS Peer Group

Special Thanks Beth Rhyne, Center for Financial Inclusion

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Executive Summary For nearly a decade, the members of the Partnership for Responsible Financial Inclusion (PRFI) have been using technology, namely mobile phones, to transform the way clients access financial products and leverage technology to streamline processes in an effort to enhance service levels. To better understand its current use of technology, PRFI carried out a member survey in July/August 2017. At the time, nine PRFI members shared information about 23 technologically enabled projects ranging from eight (35%) that had been in operation an average of four years to one that was funded but had not yet begun.

The projects reported in the survey highlight a broad array of initiatives that advance paperless processing, develop digital field applications, and provide digital financial education, among other things. The primary beneficiaries of these initiatives are women and rural communities, with a heavy leaning towards the African continent; 81% of the projects are being rolled out in countries like Uganda, Tanzania, Rwanda, and Nigeria. Asia is the region with the second highest concentration of projects, representing 15% of the reported initiatives.

Among the dominant service offerings identified through the research are airtime top-ups, person-to-person transfers, bill payments, merchant payments, and mobile money. Popular products being offered digitally include savings and credit products, which are predominantly accessed through mobile phones, agents, and branches.

The 2017 survey confirmed that PRFI members are continuing to make significant contributions to the digital financial services landscape. Member networks are leveraging diverse business models to achieve their financial inclusion goals. Within the PRFI, there are three business approaches to financial inclusion: 1) those offering an umbrella of client-centered services such as health, education, and financial services as owner-operators, 2) those providing business-to-business products and services to enhance access to financial services for low-income market segments, and 3) those providing patient capital to a portfolio of social enterprises and financial technology (fintech) companies operating in the financial inclusion ecosystem.

Significant insights were also gained from interviews conducted to complement the survey data. First, the experiences of PRFI members highlight that the lack of available information about digital financial literacy and consumer protection is negatively affecting the experience of low-income consumers, and consequently the success of digital financial services (DFS) interventions. Secondly, DFS experts identified the analysis of client data as a promising tool for better serving clients and responding to their needs. And finally, one of the most interesting revelations was that digital product rollouts have a low adoption rate without human contact. The continued need for human engagement in the early stages of a DFS implementation was not initially anticipated by practitioners.

The Partnership for Responsible Financial Inclusion will use the issues identified through this research process as the basis for areas of collaboration within the DFS Peer Group. By leveraging the expertise embodied in the DFS Peer Group, the PRFI can contribute to the evolving practices in building digital financial literacy education as well as make contributions to the development of consumer protection standards for clients accessing financial services through digital channels.

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Introduction The Partnership for Responsible Financial Inclusion (PRFI), formerly the Microfinance CEO Working Group, is a collaborative effort by ten leading international organizations supporting the responsible delivery of financial services to low-income populations around the world. Today, the members include Accion, Aga Khan Agency for Microfinance, BRAC, CARE, FINCA, Grameen Foundation, Opportunity International, Pro Mujer, VisionFund International, and Women’s World Banking. These organizations, through more than 260 local partners, offer a diverse set of products and services to navigate excluded populations and underserved clients. And to accelerate the financial inclusion of these clients, the PRFI— through the power of its CEOs and their senior managers—leverages its joint expertise in the advocacy and delivery of innovative, scalable, and responsible financial services for poor and low income clients.

No industry or enterprise is exempt from the influence of technological change. This is true as well for the PRFI members and the financial inclusion space. For nearly a decade, members of the PRFI have been adapting to this changing landscape. Members have been leveraging technological innovations to drive improvements in business operations and processes and even to fundamentally change their business models as they work towards responsible financial inclusion for low-income clients around the world.

To better understand the extent to which digital technology has changed and how it continues to influence the way each institution undertakes it mission, the staff of the PRFI—working with the Digital Financial Services Peer Group (DFS), a collective of senior managers1 from the member organizations— initiated a survey and a series of interviews during July and August 2017. The process captured a snapshot of 23 initiatives. The goal was to better quantify the reach of PRFI members using digital innovations, to document outreach similarities, and to identify opportunities where working together could better serve clients globally.

The results of the survey reflect that PRFI members are part of a vibrant ecosystem of providers helping clients to access financial services such as person-to-person transfers, savings accounts, bill payments, and airtime top-ups through mobile phones. Most valuable are the findings that indicate the areas in which the PRFI can continue to collaborate and make advances. These include enhanced digital financial literacy programs that can strengthen the responsible delivery of DFS; and PRFI members contributing feedback to the development of evolving consumer protection standards on client experience and product development as digital financial services expand. The use of technology as a delivery platform or as an efficiency accelerator is key to how PRFI members achieve their missions. In fact, digitizing financial services is the norm for how business is done today.

The Digital Landscape According to the 2014 Global Findex report published by the World Bank, 700 million adults became account holders between 2011 and 2014. However, 2 billion people remain unbanked—without any access to a financial account--and account ownership continues to vary widely around the world. In highincome OECD economies account ownership is almost universal at 94%, while in developing economies only 54% are account holders. Furthermore, there are disparities in account ownership between people of differing income brackets. While 68% of the richest 60% in developing countries had an account in 1 See Acknowledgements for list of contributing DFS Peer Group members

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2014, only 46% of adults in the poorest 40% of households had an account that year.2 By contrast, mobile phone subscriptions now exceed 3.6 billion in developing countries and are expected to reach 4.4 billion by 2020.3 In order to close the gap in financial services between wealthy and low-income communities, offering assistance or services to those with mobile phone access represents a significant opportunity.

Evolving Digital Footprint of PRFI Members The members of PRFI are contributing to closing the gap in access to financial services by leveraging the use of mobile phones as a platform to offer digital financial services. One member, Aga Khan Agency for Microfinance (AKAM), forecasts a significant increase in reach from 50,000 to one million clients in five years through the use of digital financial services in Mali alone. Given the consensus that digital innovations, through mobile services or otherwise, will increase among the PRFI members over the next five years—and a shared perception that significant inclusion can be realized in the communities in which they work—PRFI members collectively can make a meaningful contribution to reducing the number of unbanked people in the world.

As far back as 2008, PRFI members began incorporating digital innovations and digital financial services into their business models. In this survey, marking 9 years of effort, 23 PRFI member initiatives were found to reach an estimated 13.8 million clients across 17 countries. Across this sample of projects, the average length of services used was two years, but more than a third (eight of 23) had been active for three or more years. (This represents a snapshot of the PRFI digital footprint and does not capture all of the digital initiatives being undertaken by the membership.)

Target Segments Consistent with their missions to reach underserved populations, most of the PRFI members are targeting women and rural populations in their DFS programs. As illustrated in the following chart, 91% of the registered initiatives target women and rural segments.

Figure 1 : Target Segments * Registered initiatives targeted multiple segments.

According to the 2014 Global Findex report, only 58% of women have an account compared to 65% of men.

This gender gap has remained steady at 7 percentage points globally from 2011 to 2014.

In developing economies, the gender gap is 9 percentage points.

2 World Bank Group, “The Global Findex Database 2014: Measuring Financial Inclusion around the World,” April 2015.

3 GSMA data: www.gsma.com/mobileeconomy/ 6

Creative Initiatives Two examples of initiatives that illustrate PRFI members’ efforts to reach women through DFS are CARE’s Digital Sub-wallets and Women’s World Banking (WWB)’s project “Creating Paths to Inclusive Economies through DFS.” CARE’s Digital Sub-wallets initiative is a project in Uganda that was designed to increase the financial empowerment of women in partnership with PostBank and several local organizations working to increase women’s engagement with the market economy. The e-wallet service allows women to access formal bank accounts through mobile technology with pre-labeled digital sub-wallets to categorize savings for expenses such as school fees and pregnancies. The initiative seeks to motivate women to use mobile financial technology in order to increase their involvement in making household financial decisions and is being coupled in some instances with household dialogues to support couples to develop joint financial plans and goals. The approach is grounded in the belief that increasing women’s influence over household’s financial decisions will lead to positive development outcomes with more money used for her personal priorities as well as essential household expenditures such as food, education, and health.

Women’s World Banking’s program “Creating Paths to Inclusive Economies through DFS”is a collaboration with JazzCash, one of the leading mobile financial service providers in Pakistan. The project aims to increase women’s uptake and usage of the JazzCash mobile account, particularly among women. This project has two main components. The first is testing to make the onboarding process more effective for women clients. The second component consists of cross-sector partnerships in order to reach more excluded women such as those in rural areas and other low-income communities. Women’s World Banking stated that women face many of the same barriers as men, but they do so more acutely.

In addition to this, women tend to be more risk averse, therefore products presented to them need to highlight the added value they bring.

According to WWB, this project “will promote active usage of mobile financial services among women customers will yield insights into effective solutions for onboarding more women.” WWB “hopes to emerge from this project with learnings on what makes digital financial services work for women customers in Pakistan, as well as hypotheses for how those same lessons may apply in other markets.

We approach our work not only through the lens of the end customers, but also through the lens of sustainable business. Thus we also hope to build evidence for the business case for financial service providers to invest in serving low-income women through market-driven solutions.”

In addition to such targeted initiatives, PRFI member Pro Mujer, which almost exclusively targets women in the Latin America region, is connecting to an external mobile platform designed to distribute loans via a mobile channel that allows for cash-out in multiple locations. This option eliminates the need to travel to Pro Mujer centers, reducing women’s time away from their businesses and improving their safety—a concern when they sometimes travel far distances with large amounts of cash.

Geographical Concentrations According to the survey, experimentation with DFS by PRFI-affiliated institutions is strongly focused on Africa, where 78 percent of the initiatives are located. This concentration reflects the strong emphasis on Africa—and to a lesser degree on South Asia—among funding organizations, and hence influences the overall programming of PRFI member organizations. It also reflects the lively DFS innovation taking place in Africa, particularly East Africa, where organizations can build on an emerging digital ecosystem.

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According to the 2014 Global Findex report, 66% of adults in Sub-Saharan Africa do not have an account.

Figure 2: Location of PRFI Members’ Digital Initiatives

Products and Services Offered The most common types of services offered through the DFS initiatives are person-to-person (P2P) money transfers and airtime top-ups, with bill payments. These results are in line with the industry.

According to the GSMA State of the Industry Report on Mobile Money, in 2016, airtime top ups, P2P transfers, and bill payments had the highest volume of transactions globally, totaling 92.6%.

Savings, credit, and insurance were the most common financial products offered by the PRFI members through their initiatives. These findings are consistent with trends in the marketplace. According to the GSMA report referenced above, insurance, credit and savings offerings have grown over the last 5 years.

The report states: “In 2016 there were 52 live mobile money enabled credit services, up from seven (7) in 2011…and 26 dedicated savings services in 16 countries” (page 22)4. PRFI member BRAC has introduced a digital platform that allows clients to contribute to their savings remotely, no longer having to travel to the branch, saving on travel-related costs and time. Another PRFI member, Accion—employs an initiative using digital channels to acquire customers and offering loans based on a scoring algorithm. Through this channel, a broadcasted SMS message is sent to customers in a geographically focused area around a branch with a specific call to action.

As mobile and other digital tools become more prevalent, there is an expectation that the range of products and services offered will become more nuanced and tailored to the needs of customers. For example, PRFI member VisionFund International (VFI)) is exploring client interactions with mobile financial services. VFI is working to better understand clients’ basic use of technology, how information flows between the client and VFI, and appropriateness of products sold and used in rural markets in comparison those offered to urban / peri- urban markets. See the Diamond Bank Case on page 15 as one example of product customization.

The following charts show the variety of services and products offered by the PRFI members. Several 4 GSMA State of the Industry Report on Mobile Money Decade Edition: 2006-2016 8

initiatives combine two or more services into one. The breakdown below refers to the number of initiatives contained in each service type.

Figure 3: Type of Service *Mobile Information Services refers to the pulling of data and are not transactions.

Figure 4: Type of Product

Delivery Channels Used In today’s financial inclusion landscape, many financial practitioners are looking at the potential of putting financial services in the palms of low-income clients through mobile phones. Mobile phones have the potential to democratize access to information and access to services, financial or otherwise.

Consequently, it is not surprising that the PRFI survey showed mobile phones as the dominant channel within digital initiatives.

Consistent with the trends in the marketplace, agent networks are the second most indicated channels.

As financial service providers attempt to find new ways of bringing on clients, particularly those in hardto-reach areas, the use of agent network models have been widely adopted. Agents allow for lower-cost

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access to clients relative to building a high-cost brick and mortar operation. Agents are often connected to the communities they serve and have existing businesses that can be leveraged as a mode to connect with

Figure 5: Type of Channel used

new clients. Through this decentralized model of access to financial services, it may be easier to reach clients in remote areas.

PRFI member, Opportunity International is undertaking several activities to transition clients from cashbased transactions to client-initiated digital financial transactions, using their own devices, at the time of their own choosing. Parallel to this, they have advanced the use of agent networks, both their own agents and third party agents. Increasingly, their activities are gravitating toward client engagement and client experience through digital (phones). Through these activities, they hope to improve efficiencies of service delivery through digital, to learn and overcome challenges of client education and uptake of digital products, and to learn how digital services change the interaction and behavior of the client.

While there were only four initiatives that identified the internet as a channel, one can envision the use of the internet will increase over time. However, it is important to recognize that electrification and infrastructure development challenges may slow the speed of access to financial services delivered both through the internet and mobile phones. This is significantly underscored in “Technology and Inequality,� a paper recently published by the Center for Financial Inclusion. In this paper, Leon Perlman, the researcher, highlights that lack of connectivity in certain regions can derail the successful implementation of a DFS project. In practice, PRFI members are experiencing the connectivity challenge. Almost all peer group members interviewed unanimously confirmed connectivity as an issue, particularly when reaching more isolated areas. Connectivity can be an issue despite the generation of technology being used. Most initiatives being undertaken by the members required 2G or 3G network connectivity, and only three initiatives noted 4G as a requirement.

Key Findings from the Research While the 2017 survey served to reaffirm the significant contributions being made by PRFI members within the digital innovations landscape, interviews with peer group members has helped to shape some 10

potential areas where members can collaborate, both among themselves, and also with other interested parties in the market. It became clear from the research that there are large gaps in the areas of digital financial literacy, consumer protection, and use of data analysis to better serve clients. In addition, peer group members also pointed to the ongoing need for human interaction, at least in the short term, as they work to bring first-time users struggling with numeracy and literacy into the financial economy.

“Organizations need to provide digital literacy and inform customers on the unique advantages and risks of digital financial services. One might assume that because mobile phones are ubiquitous and familiar, clients know how to use them for accessing digital financial services.

However, this is not the case”

Focus on Digital Financial Literacy The importance of digital financial literacy is keenly recognized by financial inclusion practitioners and even among major global actors. The G20’s High Level Principles for Digital Financial Inclusion have addressed financial literacy through the sixth principle “Strengthen Digital and Financial Literacy and Awareness” 5. The PRFI DFS Peer Group members agree that there is work to be done in this area.

Digital financial literacy has not been adequately addressed as the reach of DFS expands and this is --Grameen Foundation believed to hamper the rollout of some initiatives.

Financial literacy initiatives need to be strengthened and incorporated into financial services delivery to communicate the policies, products and financial instruments offered by financial institutions, and to help customers understand the associated benefits and risks. Failure to invest appropriately into digital financial literacy is believed to hamper the rollout and usage of DFS. On Client Protection PRFI members recognize that client protection, specifically as it relates to digital financial services, is also an important issue that must be addressed as it supports clients’ willingness to engage with and trust systems that are unfamiliar. While a broad client protection framework is ideal--and it is provided by the Smart Campaign--ensuring client understanding about pricing and complaint resolution appear to be areas where work can be done immediately. Providing this type of information as a part of digital financial literacy seems prudent, both for the benefit of clients as well as financial service providers.

Finally, with the emergence of digital as a means to deliver credit, it is imperative to think of client protection in this context. In the latest brief from the Smart Campaign, Tiny Loans, Big Questions: Client Protection in Mobile Consumer Credit, consumer risks and opportunities in mobile credit are analyzed.

The report offers several calls to action, including the need for increased discussion about best practices in appropriate product design, prevention of over-indebtedness, and pricing transparency. As Alex Rizzi of the Smart Campaign wrote, “If we don’t define and implement mobile credit consumer protection best practices, we risk damaging consumer trust, regulatory clampdowns and over-indebtedness crises.” 6

5 Global Partnership for Financial Inclusion, “G20 High-Level Principles for Digital Financial Inclusion.”

6 https://cfi-blog.org/2017/10/26/tiny-loans-big-questions-client-protection-in-mobile-consumer-credit/

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Innovation: Digitization and Data Analysis Two members of the DFS Peer Group also identified the improved use of data to better understand and serve clients as a key area for innovation in the future of the industry. Respondents agreed that the more we understand about client behavior as it relates to the delivery of DFS, the better will be our ability to tailor and modify products to meet their daily needs. In addition, increased visibility into clients’ use of financial services and improved means for clients to provide feedback potentially translates to institutions that can be more responsive to client needs.

Human Interaction The importance of human interaction for clients was also a theme throughout several interviews during this project. “Uniting Tech and Touch” published by the Center for Financial Inclusion, looked at effective human touch in Kenya and found that respondents “primarily want human touch to verify the legitimacy of the FSP, to fully understand the product, and to resolve problems or complaints”.7 For example, Women’s World Banking and VisionFund International highlighted the importance of interaction with field agents to help build trust for a new service. The face-to-face interaction provides clients with confidence that their issues and questions can be addressed given the relationship with a human contact.

It is their view that DFS will have the best ability to succeed when it is led by human interface.

Opportunities for Collaboration Digital financial services have become an integral component of financial inclusion initiatives, given that technology can be leveraged to reach populations and areas that have been traditionally excluded from financial services. In addition to providing a snapshot of how the PRFI members use digital innovations and DFS to achieve their organizational missions, the survey provided insight into opportunities for future collaborations to improve the use and strengthen the responsible delivery of DFS.

One area for partnership is digital financial literacy. The PRFI, through the DFS Peer Group, can support the sharing of best practices for financial literacy programs and coordinate the effort to work on DFS literacy issues. As a starting point, the PRFI secretariat is collecting financial literacy training materials across the member organizations in order to lay the groundwork for a shared digital financial literacy curriculum. Secondly, PRFI members are well positioned to contribute to the work being undertaken to strengthen consumer protection practices and client knowledge as digital financial services expand. To do this, in 2018 the PRFI plans we plan to connect the Smart Campaign with the DFS peer group members and local partners of the PRFI to provide best practices and lessons learned as consumer protection practices are implemented in sync with digital products.

Conclusion This inaugural review of the collective footprint of the Partnership for Responsible Financial Inclusion provides the initial impression of the track record of the member organizations with respect to DFS and digital innovations, broadens our insight into the diversity of initiatives in progress, highlights our geographical concentrations, and identifies where there are opportunities to take on jointly supported projects that can benefit both the membership and the financial inclusion space.

7 http://www.centerforfinancialinclusion.org/programs-a-projects/cfi-fellows-program/782 12

For nearly a decade, PRFI members have been transforming their business models to incorporate digital advances to expand and improve product and service delivery. While taking advantage of the value that can be added by leveraging technology, the members have remained steadfast in their commitment to serving rural communities, women, and entrepreneurs. This focus on clients has helped PRFI members to gain greater understanding of where the technology works and where challenges continue to persist.

Notably, clients still require human touch to have confidence in systems, particularly if they are new to financial services. Helping clients to have a foundational understanding of product features, and information on their rights as consumers also remains vital.

Lastly, PRFI members recognize that seizing and using client data and feedback to design dynamic products and services that are responsive to individuals’ needs will allow them to realize their vision of a financially inclusive world, responsibly delivered.

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Practitioner Profile

Diamond Bank established in Nigeria

1990

2012

- All processes done manually - Diamond BETA initiative launched DFS to market women

- Launched Diamond Y’ello with support of MTN in 2014 - WWB joins the partnership in 2016

2017

- Approx. 76% of their transactions are digital - 9 mm clients on the Y’ello initiative alone

2014-16

Figure 6: The Diamond Bank Case

Diamond Bank, a network associate of Women’s World Banking, is a fast-growing financial institution in Nigeria which began in 1990 and established a retail division in 2008. Diamond Bank incorporates innovation and technology into its operations and has implemented initiatives in digital financial services reaching over 9.5 million clients.

In 2012, Diamond Bank launched the BETA savings account, an innovative savings product that addresses barriers preventing low-income Nigerians, especially women, from accessing formal financial services.

Although local market women in Nigeria are often close to bank branches, most of them do not see these branches as relevant or accessible; and even those who have accounts usually place most of their money in traditional, informal, savings systems such as ajo or esusu, where a daily collector goes around the market to collect savings from registered customers. Diamond Bank, with support from Women’s World Banking, found that these customers value convenience, affordability and security, and thus the product is built around the bank serving women in the market places where they trade. Agents, known as BETA Friends, visit a customer’s business to open accounts and handle transactions using a mobile phone application. The BETA proposition also includes value-added services such as balance inquiry and transfers, and will include loan facilities in the near future.

In 2014, Diamond Bank partnered with mobile operator MTN to create a product called Diamond Y’ello.

The product is a mobile-based bank account opened instantly through the customer’s mobile phone in a few simple steps and is available to MTN’s over 63 million subscribers. Benefits include easy access to full banking services with interest on account balances and access to funds transfer, bill payment and airtime purchase. Currently, Diamond Bank has over 9 million clients on the Diamond Y’ello product.

In early 2016, Women’s World Banking, with support from the Bill & Melinda Gates Foundation, joined this partnership specifically to build understanding of what it takes to make digital financial services work for

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low-income women. The Diamond Y’ello account was developed as a global model for expanding women’s access to and usage of digital financial services through simplified steps in account opening and banking transactions, using mobile phones.

One of the main challenges was the adoption of digital financial products and services especially by women.

This observation stimulated a push for all staff to effectively cross-sell the products and understand their value to the customer. The CEO even appeared on an advertisement to promote the digital products and push for the acceptance of the digital technology culture. Given the dynamic nature of technology, Diamond Bank staff members have remained flexible and are provided ongoing training and exposure to new technology to keep their skills relevant to the needs of the company and customers’ changing lifestyles.

Clients were also essential in the design of the products offered through digital channels. With support from Women’s World Banking Diamond Bank has adopted a human-centered design approach and seek continuous feedback from clients. This has assisted Diamond Y’ello to deliver services that are more relevant to clients’ needs and lifestyle. Women’s World Banking has also partnered with Diamond Bank to advance women leaders in the bank through leadership and diversity programs..

About a half decade ago, most financial transactions at Diamond Bank involved manual and/or the physical presence of the customer in the banking hall, but today, over 76 percent of transactions are done using digital channels. The success of Diamond Bank and Women’s World Banking in creating a digital strategy and providing tailor-made financial services shows that innovative financial products can help expand financial services to the underbanked and unbanked.

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Appendix Online Survey Questions Digital Financial Services Thank you for your collaboration on this project. Your input is much appreciated.

We ask that you fill out one entry of this form for each current DFS initiative being carried out within your organization. For example, if there are 3 DFS initiatives currently being carried out, you will fill out the form three separate times, one for each initiative.

Please complete this survey no later than July 17th.

This survey is divided in three sections. Depending on the number of DFS initiatives, the information should take less than 1-2 hours to gather, and once collected, the survey forms will take less than 10 minutes to populate per each initiative. This survey is structured as follows: 1. Contact Information 2. DFS Initiative General Information 3. Project Details

Thank you once again for your collaboration.

If you have any questions, please contact Fernando Morales at fmorales@accion.org

Contact Information PRFI Network member * Your name: * Your e-mail: *

Digital Financial Service Initiative General Information Please answer the following questions about the DFS initiative

Name of DFS Initiative * Description *

Please provide a 4-5 sentence description of the project

Learning objectives *

Please provide 3-4 sentences about the learning objectives of the project

Name of Implementing Partner * Type of Implementing Partner * Bank, NGO, etc.

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Country * Region *

Date initiated by Implementing Partner * Projected End Date

If working with an MNO, please provide the name of the company

If you have developed a digital platform, please provide the name of the vendor Other Stakeholders

Are there other organizations involved in the funding, development, implementation or other aspects of the project? If not, write ‘None’

Project Details

Please answer the following questions regarding the DFS initiative

Number of active clients on a 30 day basis *

Please provide the average number of clients actively using the service/product within a 30 day period. In the following question, enter the “as-of” date for number of active clients

Data as of:

Total Number of project clients *

Please provide the number of clients that are part of the project. In the following question, enter the “as-of” date for number of project clients

Data as of:

Total Number of clients for the FSP *

If available, please provide the total number of clients of the FSP. If not available, write “n/a” In the following question, enter the “as-of” date for number of clients of the FSP

Data as of:

For the following questions, please select the options that apply Digital Innovation Keywords Alternative data Digital Field Application Paperless Processing Digital Financial Literacy Two-way information flow Blockchain Other:

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Type of Product Savings Credit Insurance Other:

Type of Service

Bill Payments Airtime top-up Alternative credit-scoring Person-to-person Benefit Payments Cardless withdrawal Merchant Payments Mobile Information Services Other:

Type of Channel Agent Branch ATM Mobile Internet Other:

Type of Enabling Technology POS mPOS Card Mobile Smartphone Biometric Other:

Required network connection 2G 3G 4G Other:

Segment or target group: Rural Urban Women Youth Microentrepreneurs Farmers SMEs Other: 18

Peer Group Interview Questions 1. What are the main opportunities DFS represent for microfinance/financial inclusion?

2. Have DFS been key to achieving your mission? a. When did your organization move into DFS? b. Do DFS represent 50% or more of your efforts? Do you anticipate it being so in the next 5 years?

3. What significant achievements have DFS made in reaching women?

4. Is there a trend for digital financial literacy keeping up with the implementation of DFS? Is there an opportunity for PRFI to work together to deliver digital financial literacy initiatives?

5. How do you support your affiliates/partners in their adoption and use of DFS? 6. Does current technological infrastructure allow for a proper implementation and reach of DFS? 7. Do current financial inclusion strategies enable and promote DFS? 8. What is your organization doing to ensure DFS client protection?

9. What do you think is the most significant innovation in the future of DFS?

Local Partner Interview Questions

1. What are the main opportunities DFS represent for your organization?

2. Have Digital Financial Services improved your organization’s reach?

3. How was the implementation process? a. How long did it take b. Did staff react well to the addition of DFS services c. Do they promote the DFS services to clients and how do you monitor?

4. How do you ensure continued use of DFS? a. Do you provide digital and financial literacy initiatives? b. Are there campaigns aimed at raising awareness of DFS? 5. How does the regulation in your country affect your ability to implement DFS? 6. Does the current infrastructure allow for proper DFS implementation?

7. Has your experience borne out the assumption that DFS is cheaper than traditional services for the institution?

8. If you offer loans through a digital platform, are those loans priced lower than a traditional loan?

9. For your institution, what is the time horizon to realize the investment made in DFS?

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Glossary Definitions are taken from the GSMA 2015 State of the Industry Report, Appendix B.8 Airtime top-up

Purchase of airtime via mobile money, funded from a mobile money account

Bill payment

A payment made by a person from either their mobile money account or over-the-counter to a biller or a billing organization via a mobile money platform in exchange for services provided.

Merchant payment

A payment made from a mobile money account via a mobile money platform to a retail or online merchant in exchange for goods or services.

Mobile money

Person-to-person (P2P) transfer

Mobile money is a service which the underserved can use to make and receive payments using a mobile phone. GSMA Mobile Money tracks mobile money services which meet the following criteria: • The service must offer at least one of the following services: P2P transfer, bill payment, bulk disbursement, merchant payment, and international remittance. • The service must rely heavily on a network of transactional points outside bank branches which make the service accessible to unbanked and underbanked people. Customers must be able to use the service without having been previously banked. Mobile banking services which offer the mobile phone as just another channel to access a traditional banking product, and payment services linked to a current bank account or credit card such as Apple Pay and Google Wallet, are not included. • The service must offer an interface for initiating transactions for agents and/or customers which is available on basic mobile devices A transfer made from one person to another person.

8 https://www.gsma.com/mobilefordevelopment/wp-content/uploads/2016/11/SOTIR_2015.pdf

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Through its core values of respect, openness, excellence, and collaboration, the Partnership for Responsible Financial Inclusion (PRFI) commits to accelerate financial inclusion by leveraging our joint expertise in the advocacy and delivery of innovative, scalable, and responsible financial services for poor and low income clients.