MFS 2.0: Financial inclusion and fulfilment
There are over 50 million people in Bangladesh who access and use financial services from their mobile phones. Most of those users were previously unbanked, with little or no access to formal financial accounts. The success of mobile financial service (MFS) providers such as bKash and others in reaching the majority of the country's adult population in seven years after starting operations is an impressive achievement.
That said, seven years is a long time in business and the same can be said about the MFS industry too. Initial successes in expanding access to finance has created a competitive MFS landscape where MFS users no longer just expect to be "included", but to also be "fulfilled".
Isn't that an intriguing thought! But what does financial fulfilment mean for the MFS industry?
The word "fulfilment" was introduced to modern business lexicon by early Internet pioneers, today's e-commerce giants such as Amazon and e-Bay. Their pioneering mission was to make online transactions easy and efficient for their customers.
Everything they did, from accepting an online order through a website to collecting goods from a warehouse and shipping that to the customers, was focused on fulfilling customer expectations. Customer fulfilment was, and still is, all about providing high-quality service to customers at the right price, at the right time, and exactly the way the customers want it.
The MFS industry in Bangladesh is at a similar inflexion point.
It is no longer enough for MFS providers to just add new unbanked customers and provide access to financial accounts. MFS customers want access to new financial products and services, delivered on mobile, conveniently and quickly.
This presents a dilemma for MFS providers. How can MFS providers make financial transactions easier for millions of Bangladeshis with low literacy and numeracy skills?
Until now, MFS customers had to dial a USSD short code to do their financial transactions. USSD has major constraints in the Bangladeshi context. The biggest constraint being that this channel, or method of doing financial transactions, does not support Bengali text.
To "fulfil" customers, MFS providers have to allow their users to interact and transact on the financial platform in Bengali. And the best way to enable financial interactions in Bengali is to develop a user-friendly mobile app with Bengali text and voice prompts that will guide users through the financial transactions process.
Furthermore, financial fulfilment isn't just about implementing changes that are visible or tangible to customers. The financial services industry is unique because it is in the business of managing people's money, and money is all about trust. Financial transactions not only have to be easy for MFS users, transacting must also be perceived as being safe.
If someone is paying a bill through a mobile app and the app hangs or crashes during the payment process, it can undermine user confidence and trust in the MFS provider. To fulfil customer trust, MFS providers have to build a technologically stable, secure and scalable app that does not crash during periods of heavy use.
The MFS industry in its first seven years focused on adding new users and getting them used to the idea of doing financial transactions on their mobile devices. Perhaps MFS providers also needed that time to develop sustainable business models and enhance their technical capabilities for future growth.
But there is little doubt that the MFS industry is primed for a new phase of growth, arguably phase 2.0. This new growth phase must focus on offering customers a wider range of MFS products and services at affordable prices, providing users greater choice and convenience in how they transact and with whom.
Put simply, MFS providers have to fulfil the everyday financial needs of users who are still unbanked, as well as cater to the existing users who want higher-value financial services delivered seamlessly on mobile phones.
Nofel Wahid is the Financial Product Lead at bKash Limited.
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