The worldwide un-banked market is estimated
to be in excess of 2 billion people.
You probably have the following questions!
What is the size and commercial potential of the market?
What are the most effective forms of marketing, distribution and credit
scoring?
Once banked how best to retain customers?
What are the opportunities for cross-selling additional banking services?
What are the compliance issues surrounding the unbanked market?
What are the best strategies for success?
How do these differ from traditional strategies?
How do these vary from country to country?
What are the opportunities and strategies for partnering with non-financial
institutions to deliver financial services to the unbanked?
Who are the unbanked?
The unbanked is not a homogenous group. They are, however, disproportionately
represented amongst low income groups, the unemployed, the less educated,
rural and remote communities immigrant and minority populations and
the retired.
Truly they are a global phenomenon, over 10% of the UK and US remain
un-banked.
Why are the unbanked, unbanked?
Historically the unbanked have been viewed as risky and unprofitable,
however
the commercial success of the informal financial sector, and the tremendous
growth and low default rates enjoyed by the microfinance movement,
has forced
a review. Technological developments and the growing trend of delivering
banking
services through third party intermediaries has also meant that banking
services
can be made more widely available and at a lower cost than ever before.
One such solution is the prepaid credit card, which is available to
individuals in the
UK with no credit check, no employment status, and no bank account
required.
What is the business case for banking the unbanked? Evidence shows
that once
banked the unbanked are more open to cross-selling opportunities than
'traditional'
customers. In addition the growing emphasis on corporate social responsibility
in the
financial services industry has also seen banks take the view that
making their
services universally accessible is a part of their obligations to
the community.
Can the unbanked be approached with the same strategies that are used
to attract
and retain traditional customers? Evidence from around the world suggests
not,
and for a variety of reasons. Successful programs have used, financial
education
marketing to families innovative use of electronic and mobile solution
partnerships
with non-traditional financial providers and new approaches to customer
service.
UK National Consumer Council has expressed its support for the UK
government's
financial inclusion strategy as a step in tackling the two million
adults who still do
not have access to a bank account, as well as planned measures to
increase
affordable credit, promote Christmas savings schemes and protect low-income
savers
