Delivering Innovations to scale up Mobile Financial Services for Financial Inclusion in Africa

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    20-Jun-2015

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mFino talks about delivering innovation for the adoption of mobile financial services for financial inclusion in Africa at the 4th Mobile Money Expo, Nigeria.

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  • 1. 2013 mFino Ltd.| All Rights Reserved |Confidential Delivering innovations to scale up Mobile Financial Services to promote Financial Inclusion in Africa

2. 2013 mFino Ltd.| All Rights Reserved |Confidential Financial Inclusion Finance is not an end by itself but a means to help solve significant development challenges in order to improve the lives of people Financial Inclusion helps to make basic, essential services and utilities like energy, health, education, and water more accessible to people at the bottom of the economic pyramid Access to affordable financial services helps in overcoming poverty, reducing income disparities, and contributes towards overall social and economic development (GDP Growth) 3. 2013 mFino Ltd.| All Rights Reserved |Confidential Population of Africa more than 1.1 billion Total mobile subscribers: above 800 million Close to 80% of the adult population is unbanked which stands at 326 million 25 African countries have mobile penetration more than 90% Nigeria mobile subscriptions at 120 million Sources 1. World Bank 2. MDI 3. GSMA 4. Tech 360 (http://www.tech360ng.com/nigerian-subscribers-at-120m-in-2013-q2-mtn-tops-table/ ) 5. Business Community (http://www.bizcommunity.com/Article/410/87/62217.html Africa An Overview 4. 2013 mFino Ltd.| All Rights Reserved |Confidential Africa leads MFS with 117 of the total 220 deployments in the world Source: GSMA Mobile Financial Services in Africa 46% mobile money transactions processed in East Africa Main services offered Airtime Top-up P2P Transfer Bill Payment Receive Bulk Payments 5. 2013 mFino Ltd.| All Rights Reserved |Confidential Dimensions of Financial Inclusion Access Usage Quality Availability of formal, regulated financial services Physical Proximity Affordability Actual usage of financial services and products Regularity Frequency Duration of time used Products are well tailored to client needs Appropriate segmentation to develop products for all income levels 6. 2013 mFino Ltd.| All Rights Reserved |Confidential Barriers to Adoption of Mobile Financial Services Need to provide status for electronic transactions Flexibility in the application of CDD requirements for technology based solutions Stringent Regulations Hindering wide spread access Less than 20% of the products are fully or partially interoperable Limited Interoperability Most agents lack knowledge & ability Well qualified agents not easy to find Scarcity of Qualified Agents Lowest Literacy rate in the world Risks and benefits of MFS needs to be articulated well Low level of Financial Literacy & Income 7. 2013 mFino Ltd.| All Rights Reserved |Confidential Transformational Approaches for Financial Inclusion Access to a range of quality financial services at affordable prices, delivered with convenience and dignity, can change the course of an individuals, familys, or businesss future. Mobile Initiatives Individuals SMEs Women Provide innovative products & services beyond payments Savings, credit , insurance, rewards etc Access to finance (working capital, bridge finance, bank guarantees etc) Credit Scoring and increase in the borrowing limits Insurance for protection against unforeseen events/ exigencies Access to income generation loans (beyond micro-loans) Support for entrepreneurship Financial Literacy Utilities & Essential Services Access to energy, clean water, education, health etc Mobile Markets for agriculture Informational services (weather, commodity price, best practices etc) Social&EconomicDevelopment 8. 2013 mFino Ltd.| All Rights Reserved |Confidential Retaining the tapped and targeting untapped customers Small percentage of households enjoy formal banking 90 % of transactions are in the form of cash Lack of savings, asset creation and protection tools savings less than 15% in Africa Current State Limited information available about Nature & size of market Investment required Risk involved Customer needs & preferences Barriers for Financial Access Government adopting digital payments Offering customers with tools to keep digital money within the ecosystem High scope for Mobile Savings, Loans and Microinsurance products Opportunity Source: Publication on Financial inclusion in Africa by African Development Bank 9. 2013 mFino Ltd.| All Rights Reserved |Confidential Reach out to SMEs There are 50 million SMEs in Africa 69% of them operate in informal sector Contributes to 58% of employment and 33% of GDP Current State Considered high risk by banks Lack of wide range of financial products that suite their business Poor customer information and knowledge Barriers for Financial Access MSME (Micro-Small Medium Enterprise) market worth USD 150 billion Innovative, tailored and technology enabled intervention For e.g. M-Pesas recent micro insurance product for farmers Kilimo Salama Opportunity Source: Publication on Financial inclusion in Africa by African Development Bank 10. 2013 mFino Ltd.| All Rights Reserved |Confidential Reach out to Women One third of the firm owners are women Women account to 20% of the banked population in the continent Financial gap more acute in rural areas where women benefit from only One tenth of the credit to small farmers and less then 1% total credit to agriculture Current State Economic barriers Social Cultural barriers Unfavourable environnent Barriers for Financial Access Financial inclusion for women has social benefits (helping in children's nutrition, clothing, health and education) Microfinance Institutions have a large scope in increasing financial adoption for women Help build credit history for easier access to loans from banks Opportunity Source: Publication on Financial inclusion in Africa by African Development Bank 11. 2013 mFino Ltd.| All Rights Reserved |Confidential Access to Utilities & Essential Services 600 million of the population is part of agriculture 5% of the budget and 10% of the commercial bank lending goes to agriculture Only19% of the rural population is banked Agriculture contributes to 40% of the GDP and provides livelihood to 70% of the population Current State Limited level of finance Lack of access to credit, payment services and insurance products Lack of engagement by commercial banks Barriers for Financial Access Significant potential in offering MFS for Mobile Market Place, Informational, agricultural loans, energy, water, health, education etc Microfinance Institutions Provided 7.8 billion loans to 6.1 million borrowers, but the untapped opportunity is larger Opportunity Source: Publication on Financial inclusion in Africa by African Development Bank 12. 2013 mFino Ltd.| All Rights Reserved |Confidential Mobile is the gateway to Financial Inclusion 13. 2013 mFino Ltd.| All Rights Reserved |Confidential Innovative Mobile Financial Services for Financial Inclusion Bill Payments Send Money Airtime Purchase Receive bulk Payments Micro Insurance Savings Credit Loyalty/Reward Programs Online Payments Credit Scoring Proximity Services First Generation Services Second Generation Services Next Generation Services Ticketing Retail Payments International Remittance Salary Payments 14. 2013 mFino Ltd.| All Rights Reserved |Confidential mFino MFS platform ensures that cash remains within the system The platform connects both the source and destination with an integrated first mile to last mile mobile wallet All sources of funds can be routed to the mobile wallet and payments can be made using the mobile mFino Mobile Financial Services Platform Any Phone Any Payment Method Any Channel 15. 2013 mFino Ltd.| All Rights Reserved |Confidential Questions..??? 16. 2013 mFino Ltd.| All Rights Reserved |Confidential Thank You

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