The central role of agents in Mobile Money.

As recently mentioned on the MMU Blog, A healthy mobile money service doesn’t just have engaged customers, it will also have engaged agents. This was exactly the focus of my recent presentations in Dubai and South Africa.

When operators consider launching a mobile money service, they are often perplexed by the thought that to attract customers, you need agents but to attract agents you need customers. While both of these are crucial to a vibrant (and profitable) Mobile Money ecosystem, I have drawn on my experiences to offer some arguments as to why the agents should be key focus in the early days of your Mobile Money success story.

Firstly, lets touch briefly on what function an agent has in this new world. They can be responsible for registration of new user as well as for m-wallet cash-in and m-wallet cash-out. There are different approaches that you can take for this; all agents can perform all functions (as in the Safaricom M-Pesa model) or different agents can be selected to perform each of the roles (as in the MTN Uganda model).
The agents also have a crucial role to play in the promotion of the Mobile Money service and supporting the subscribers. They are the ones who are in direct contact with the customers on a day to day basis and are an ambassador for your service. When a user has a question, generally the agent will be the first person there to help them find an answer. Particularly, in smaller communities it is highly likely that the agent may be a trusted and respected resource in the community.

So, now that we have established just how important these agents actually are, how do we go about building the network? Who are the agents? Many successful agent networks have been built around using existing airtime retailers. They are known to both the operator and the subscriber and already access personal data and transaction information. Operators already have information about their retailers, they can easily access data about who is performing a lot of transactions, where they are located and how often they call customer care. It is easy for them to select among these retailers the ones who will become mobile money agents.

Another valuable option to nourish the agent network, is to select new partners such as financial institutions, banks & credit card companies or micro-finance institutions. Other trusted community bodies such as Post Offices or Pharmacies could also be utilized.

Of course, key to ensuring the success of your agent network is in depth knowledge of the local regulations. Does the local regulation allow the operator to use the existing distribution network to open accounts? To perform transactions? These questions must be answered at an early stage. In Kenya agents can open money accounts if the subscriber presents an ID but in Peru only banks can open money accounts. While in Brazil and India, agents are able to open low-balance accounts but documents must be validated by a bank. Local knowledge is the key.

With so many innovative installations of Mobile Money currently sprouting around the globe, knowledge in this area will continue to grow exponentially over coming years.

If you have heard of any inspired examples of building an agent network, please leave a comment below.

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