1 July 2010
Mr. Mike Rios of Microfinance Opportunities livened up the audience at the 2010 RBAP-MABS National Roundtable Conference in Manila on June 3rd with an entertaining and informative presentation on marketing strategies.
“Market like your customer, not like your ‘Mom’” was the first of his three rules of marketing new products. Too often, marketers focus on the benefits that are not tangible to the customer, pretty much like moms lecturing about the benefits of vitamins to their children. Imagining what it is like to be a customer should drive design, branding and marketing decisions. Think of how Flintstones vitamins changed the way vitamins were marketed to children.
Mr. Rios’ second rule is: “Make your product easy to try, buy, and know ‘what’s in it for me’.” A product can have great brand recognition, but if customers do not know what the product does or how it benefits them, then the product will not be successful. This seems like a great lesson as banks look at how to market mobile phone banking services – take the time to explain to your customers why it is safer and more convenient to use GCASH or Smart Money, and then show them how to use the technology.
The third rule is: “The experience you give is your best marketing.” Mr. Rios shared an example of a small bank in Cambodia that has its employees go to people’s homes, sit on the floor, and explain to them how banking can change their lives. The friendly and sincere staff provides their clients with a memorable experience.
Mr. Rios continued with three marketing tips. “Walk in your client’s shoes,” he advised. Document what a client does when he or she first walks into your branch and take pictures of what the client observes. Remember that an unfamiliar environment can be confusing to new clients. Redesign the lobby or improve the signage to make your branch more welcoming and engaging. Second, Mr. Rios recommended creating simple tools. These tools can be stories that teach people how to save or testimonials from past and current clients that illustrate the benefits of the bank’s products. It is not about “dumbing-down” concepts, but prioritizing what is important and making ideas easy to remember. Finally, Mr. Rios concluded by urging rural banks to conduct lots of mini pilots: “Those who constantly improve their ideas will be the winners.”
Jove Tapiador, MABS Regional Manager for Luzon, continued this compelling panel session by offering a consumer profile of the average Filipino, and providing guidance on how this changing profile affects microfinance marketing strategies. The recent economic problems have pushed Filipinos to stay at home more, so offering house to house calls or promoting the ease and convenience of mobile phone transactions can provide clients a way to conduct banking without leaving their homes. As Filipinos look for alternate sources of income, rural banks should emphasize microenterprise loan products and share their previous experience with successful microenterprise clients to build a trusting relationship and to promote the benefits of microfinance services.
Another trend in Filipino buying behavior is the value of performance over image and the shift from premium to less expensive brands. This is a great opportunity for rural banks to communicate the advantages of their products over fancy commercial bank services. They can emphasize the convenience and excellent customer services offered by local rural banks.
Filipinos are now less inclined to make impulse purchases. Rural banks can prepare effective marketing materials with better information about the bank, its products and its prices. Given the tendency to be more cautious and put aside more money, rural banks can also now promote savings to help clients save for a rainy day.
What are some of the unique marketing strategies your bank has implemented? How are you adapting to the changing needs of the microfinance customer? Share your experiences and stories by replying to this post.
This is the final edition of the 2010 RBAP-MABS National Roundtable Conference session recaps. We look forward to another informative and rewarding conference next year.
Until next time, Mabuhay ang Rural Banking at Mabuhay ang Microfinance!
Mr. Mike Rios of Microfinance Opportunities livened up the audience at the 2010 RBAP-MABS National Roundtable Conference in Manila on June 3rd with an entertaining and informative presentation on marketing strategies.
“Market like your customer, not like your ‘Mom’” was the first of his three rules of marketing new products. Too often, marketers focus on the benefits that are not tangible to the customer, pretty much like moms lecturing about the benefits of vitamins to their children. Imagining what it is like to be a customer should drive design, branding and marketing decisions. Think of how Flintstones vitamins changed the way vitamins were marketed to children.
Mr. Rios’ second rule is: “Make your product easy to try, buy, and know ‘what’s in it for me’.” A product can have great brand recognition, but if customers do not know what the product does or how it benefits them, then the product will not be successful. This seems like a great lesson as banks look at how to market mobile phone banking services – take the time to explain to your customers why it is safer and more convenient to use GCASH or Smart Money, and then show them how to use the technology.
Read the rest of this entry »
30 June 2010
Leaders from the mobile phone industry and rural banking met on June 3 to discuss new developments in mobile phone banking during the 2010 RBAP-MABS National Roundtable Conference in Manila.
Mr. Jaime Fraginal Jr., Head of Sales of G-Xchange, Inc. – a wholly owned subsidiary of Globe Telecom – first presented GCASH Remit, an instant cash pick-up service for domestic and international remittances. This convenient service, accessible through 18,000 partners across the country (including 3,000 partners from the rural banking network), has low remittance charges for the sender and is free of charge for the beneficiaries. Because there is no third party handling the cash and it requires a PIN number from the beneficiary, GCASH Remit is safe and secure. By building the infrastructure to increase the flow of money throughout the nation, GCASH Remit looks to play a significant part in the development of the Philippine countryside as another remittance opportunity for accredited rural banks.
Mr. Fraginal also introduced the Mobile Phone Banking Marketing Program II, an incentive program for rural bank clients to induce their customers to test and become familiar with mobile phone banking services using GCASH. This promotion will provide rural bank merchant-partners with an additional source of income while increasing the marketing network of rural banks to support and expand the use of mobile phone banking services.
Next, Mr. Marcelino Pangda of Green Bank described how his bank developed a Mobile Phone Banking Unit to utilize SMS technology and the GCASH platform. With continuous training and willingness to be exposed to new emerging technologies, the employees and clients of Green Bank successfully embraced mobile phone services with a significant increase in mobile banking transactions in 2009. Mr. Pangda shared the bank’s performance in mobile phone banking services over the past few years, with a 50% increase in the number of mobile phone transactions and an 80% increase in the amount transactions in 2009. Cash-in and cash-out transactions make up over 85% of the bank’s mobile phone transactions. Green Bank is expecting increases in both enrollment and number of mobile phone banking transactions in 2010. It also plans to integrate its mobile phone banking services with its ATM services to offer a full suite of e-banking services.
To close this panel discussion, MABS Chief of Party John Owens expanded upon his introduction of branchless banking from the first day’s session. RBAP-MABS’ commitment to the growth of mobile phone banking in the Philippines is evident with a major expansion in mobile phone banking services via the GCASH platform. There were also the introduction of mobile money transfer for Smart subscribers via the Smart Money platform, the testing of a new mobile phone banking application for GCASH subscribers, and the partnership with Microfinance Opportunities and MasterCard Foundation to develop financial education tools and utilize a growing network of rural banks merchant-partners.
Merchant-partners will provide cash liquidity (cash-in/cash-out) to rural bank clients while training clients on the functionality and services of mobile phone banking. They will also be referred to the local branch to open a deposit account or apply for a loan, if they are not yet rural bank clients. Rural banks will also have the opportunity to help their merchant-partners manage their GCASH wallets providing essential liquidity services while also helping to build deposits. Mr. Owens stressed the importance of unity among rural banks when it comes to standardizing the cash-in/cash-out fee structure if they intend to capture a significant portion of this market.
How has your bank embraced the new age of mobile phone banking technology? Share your stories and experiences by replying to this post.
Until next time, Mabuhay ang Mobile Phone Banking!
Leaders from the mobile phone industry and rural banking met on June 3 to discuss new developments in mobile phone banking during the 2010 RBAP-MABS National Roundtable Conference in Manila.
Mr. Jaime Fraginal Jr., Head of Sales of G-Xchange, Inc. – a wholly owned subsidiary of Globe Telecom – first presented GCASH Remit, an instant cash pick-up service for domestic and international remittances. This convenient service, accessible through 18,000 partners across the country (including 3,000 partners from the rural banking network), has low remittance charges for the sender and is free of charge for the beneficiaries. Because there is no third party handling the cash and it requires a PIN number from the beneficiary, GCASH Remit is safe and secure.
By building the infrastructure to increase the flow of money throughout the nation, GCASH Remit looks to play a significant part in the development of the Philippine countryside as another remittance opportunity for accredited rural banks.
Mr. Fraginal also introduced the Mobile Phone Banking Marketing Program II, an incentive program for rural bank clients to induce their customers to test and become familiar with mobile phone banking services using GCASH. This promotion will provide rural bank merchant-partners with an additional source of income while increasing the marketing network of rural banks to support and expand the use of mobile phone banking services.
Since its launch earlier this year, MABS and GXI have been conducting trainings for bank clients in order to expand the mobile phone banking and m-commerce community. Read the rest of this entry »
29 June 2010
Several technological developments for support and expansion of microfinance services were presented during the 2010 RBAP-MABS National Roundtable Conference held in Manila on June 2-3, 2010.
Ms. Rebecca Hughes, Philippines Country Director of Innovations for Poverty Action (IPA), first introduced a credit scoring model and automated loan application process via netbooks. The new loan application process via netbooks allows loan Account Officers to quickly and easily upload and prepare cashflow lending applications from the field. In addition, IPA has also added a credit scoring system into the application to better predict the borrower’s likelihood of repayment based on information such as cash flow, debt capacity and past repayment patterns of comparable borrowers. For the staff and clients, the netbooks help speed up the processing of loan applications in the field.
While Ms. Hughes cautioned that not every bank will be able to implement the credit scoring system overnight, all banks can benefit from the automated loan applications via netbooks. This can also provide banks with the first step in collecting data that can one day be utilized by the bank to implement a credit scoring system.
Next, Mr. Reggie Ocampo, President of First Macro Bank, presented his bank’s experience with implementing the loan application process in partnership with IPA via netbooks. His Account Officers found that this system greatly improves their productivity by 1) making it easier to facilitate client documentary requirements, 2) significantly reducing paperwork and 3) increasing the speed of credit and background reporting. Thanks to the system’s worksheets with automated calculations. Additionally, the objectivity of the credit scoring model reduces the reliance on supervisor and credit committee reviews. Account officers reported that clients are actually impressed with the netbook technology, seeing the bank as more professional. Mr. Ocampo stressed that a credit scoring system, however, cannot replace a skilled and responsible Account Officer. He added that it only provides another tool in the final decision making process of loan approvals.
Finally, Ms. Christine Amarra, Program Manager of Blueblade Technologies Inc., introduced a new mobile phone banking application specifically designed for MABS mobile phone banking services via GCASH. Currently, bank account information must be inputted each time a user transacts via the GCASH menu, which may result in the entry of inaccurate information. Blueblade’s new mobile phone banking application solves this problem by allowing the clients to store their bank account information, the bank’s mobile number, and the transaction codes for each specific mobile phone banking service in a secure java application on the phone. Additional features include the ability to store multiple banks and accounts in a user’s profile as well as an easy-to-use interface. Ms. Amarra demonstrated the application live at the end of the panel session. Blueblade will be testing this application in an agreement reached with RBAP-MABS. The plan is to offer this program to all interested GCASH-accredited rural banks in the near future.
Are your Account Officers using Netbooks for electronic loan applications? Do you think the mobile phone banking application that stores most of the bank account details securely on the phone as well as automates the transaction process would be useful to your employees and your clients? Share your thoughts and experiences by replying to this post.
Until next time, Mabuhay ang Technology!
Several technological developments for support and expansion of microfinance services were presented during the 2010 RBAP-MABS National Roundtable Conference held in Manila on June 2-3, 2010.
Ms. Rebecca Hughes, Philippines Country Director of Innovations for Poverty Action (IPA), first introduced a credit scoring model and automated loan application process via netbooks. The new loan application process via netbooks allows loan Account Officers to quickly and easily upload and prepare loan applications from the field. In addition, IPA has also added a credit scoring system into the application to better predict the borrower’s likelihood of repayment based on certain indicators such as the borrower’s background, cash flow, debt capacity and past repayment patterns of comparable borrowers. For the staff and clients, the netbooks help speed up the processing of loan applications in the field.
While Ms. Hughes cautioned that not every bank will be able to implement the credit scoring system overnight, all banks can benefit from the automated loan applications via netbooks. This can also provide banks with the first step in collecting data that can one day be utilized by the bank to implement a credit scoring system.
22 June 2010
Always a contentious yet lively discussion, fraud was addressed at the 2010 RBAP-MABS National Roundtable Conference in Manila on June 2-3. Ms. Girlie Lopez, MABS Regional Coordinator for Visayas, kicked off the panel discussion by describing the many faces of fraud and providing a few helpful tips for bank management.
At the loan solicitation stage, fraud can take the form of bribes, “processing fees”, over-appraised collateral and false identification. At the collection stage, fraudulent activities include non-remittance of collections, altered or fake official receipts, and modification of management information system (MIS) records. Additional forms of fraud can be unauthorized restructuring or extensions of payment schedules, unauthorized withdrawals, writing-off recoverable assets and false benefits claims for insurance.
Account officers and supervisors have the greatest opportunity to carry out these activities. That is why bank executives must be diligent in their management of fraud. Ms. Lopez noted that banks can prevent fraud by institutionalizing a culture of professionalism, honesty and compliance while evaluating the effectiveness of their internal control systems and policies. Read the rest of this entry »
21 June 2010
Micol Pistelli of MIX introduced the concept of social performance to the crowd of rural bankers at the 2010 RBAP-MABS National Roundtable Conference held on 2-3 June. Social Performance Management (SPM) involves the definition of desired social improvement metrics and measurement of the results against desired performance.
Ms. Pistelli makes a case for the inclusion of social performance as a key measurement for rural banks along with their financial performance measurement. SPM will bring greater social responsibility to the rural banking sector, provide access to more donors and investors, and improve the industry’s overall transparency. By the end of 2009, 208 Microfinance Institution’s (MFIs) had reported on social performance indicators to MIX, including five from the Philippines. She strongly encouraged MABS participating banks to report their social performance indicators to MIX (see the end of this article for reporting details).
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