Putting Clients at the Center: A reflection from Microfinance Opportunities, Part 2

This is Part 2 of a blog post written by Monique Cohen, President and founder of Microfinance Opportunities, about client-centered financial inclusion. 

This second blog continues our earlier theme of ‘putting clients at the center’ but explores the issues through the lens of building financial capabilities. Recent MFO work related to branchless banking provides insights into how existing financial behaviors constrain usage of cell phone banking and how well-targeted consumer education (CE) can help to overcome these hurdles.^[1]

Do you recall the first time you deposited a check using an ATM or a cell phone? You, like me, did so fearfully. Are the poor any different? No, but they have less exposure to technology and banking. Addressing these constraints, MFO conducted a CE pilot in the Philippines focused on the use of GCASH, Globe’s mobile wallet, for carrying out banking transactions, loan payments, deposits, and withdrawals. The seminar highlighted three significant challenges and the behavior change actions taken to address them.

1. Consumer Trust
   • Behavior: People do not use a system that does not give them paper receipts.
   • CE solution: A visual starter kit for clients was developed that explained the built-in security features of technology, the function of a PIN, and what an SMS confirmation is and how the information it contains–the amount sent or the transaction reference number–can be compared with a paper receipt.
   • Results: Clients can be transitioned to rely on the safety features of mobile phone banking. Treatment clients accepted SMS confirmations compared to only one-third of those not exposed to the CE tool.
2. Consumer Confidence
   • Behavior: People rely on others, like merchant-agents and bank staff, to transact on their behalf.
   • CE solution: In tandem with the client starter kit, a flip book for bank staff and a set of training posters for merchants were developed. Each provided straightforward, illustrated steps of how to conduct a transaction.
   • Results: Training based on the CE tools resulted in customers performing transactions on their own and not relying on merchants.
3. Bank Staff and Agent Support
   • Behavioral constraint: Bank staff/ agents had difficulty selling e-banking.
   • CE solution: Flip books for bank staff and training posters for agents provided a systematic way of selling the service.
   • Results: Bank staff took ownership of the sales process by customizing the tools to each client. Agents were better able to explain benefits and steps for using services and to convince clients to sign up.

This Philippines strategy built on MFO’s experience that shows that CE messages are most effective when repeated often and delivered using a mix of communication channels. Designed as a comprehensive package, the activities included posters to create awareness; brief explanations given by agents using flip books; trainings at bank orientation meetings; a client starter kit; and SMS messaging to reinforce benefits of e-banking, encourage good money management practices, and demonstrate client value of the service.

These CE tools ‘put clients at the center.’ They go beyond traditional product marketing and impact positively the operations of the service. They build on key touch points between the customer and the agent/bank staff, embedding the delivery of CE within the organization’s operations. Moreover, the simplicity of the materials and consistency of the messages minimizes the confusion and mistrust that poor people frequently face as they attempt to leapfrog into 21^st century, its technology, and banking.

Footnotes

1. With the support of the MasterCard Foundation, MFO conducted a CE pilot in the Philippines, with the Microenterprise Access to Banking Services Program funded by USAID (MABS) and the Rural Bankers Association (RBA).