Gane Simbe – Deputy Governor of CBSI/Chair of PIRI – Regional Workshop on Core Agent Network Accelerators (01/02/16)

February 1, 2016

Opening address by Deputy Governor of CBSI/Chair of PIRI  Gane Simbe.

for Regional Workshop on Core Agent Network Accelerators at the Heritage Park Hotel on February 1 2016

I am pleased to take part in this opening ceremony this morning. And to welcome our facilitators from Helix Institute of Digital Finance and you, the representatives of participating banks and MNOs from the region.  We welcome you to Honiara.

Let me also acknowledge PFIP / UNDP as the host of this event. PFIP has been our great partner and plays the key role to facilitate digital financial services in the Pacific Island countries.  And particularly in partnership with Pacific Islands Regional Initiative on Financial Inclusion (PIRI), the regional central banking group and part of the international Group, the Alliance for Financial Inclusion (AFI).

I must thank Mr. Kishnan, our man on the ground for PFIP here in Honiara, who has organized this training, just thirty-two days into the year, while some of us are still in the holiday moods.

This leads me to ask; why is this training matters most for us?

Let me share our conviction on why the timing of this workshop, earlier on the year is critical for Pacific Islands region.

First in the Pacific region, Digital financial services delivery channels, is a new channel for most Pacific region. The banks and MNOs introduced their services in the last 2 to 3 years. And with several geographical and other challenges in the Pacific; we need all the support and lessons learnt from countries around the globe to help our digital service providers, solve the challenges that we face, in our region, when extending financial services to our communities. And for the regulators to know what to do and what to regulate.

The region has been testing various models of financial services delivery to bring financial services to our people in the past years, but learnt that some of the channels do not make business case for the service providers, and end up being unsustainable.

However, we believe that digital financial service delivery channel is promising alternative for financial inclusion because of its ability to reach many groups in the population using the latest digital communication technology. And if fully utilize it will also make good business investments for the digital financial service providers as well.

Therefore, training of this nature that will help develop a robust agency network is indeed appropriate and important.

Let me just take some time to give you our experiences in Solomon Islands, on our financial inclusion plans and how this training fits into our National Financial Inclusion strategies for the next 5 years.

Without bothering you with details, in the past 5 years in partnership with banks and our MNOs, we have successfully put in place the infrastructure to expand the digital financial service in our country. Coverage of telecommunication to the main populated communities has been achieved and remaining communities are being introduced to the digital communications as we speak.

The numbers of adult population that own mobile phone has increased, laying the potential for growth in the digital financial services to the customers.

The numbers of individuals who have a bank account with licensed commercial banks have grown – a welcoming indicator. But the conclusion of our Demand Side Survey, conducted in 2015, revealed that only about one-third of our adult population are banked and active users of our formal banking services. Another one-third are being served by the informal sector. And the last one-third of the adult population are totally excluded.

This simply means that we have to work harder in the next 5 years to bring a good portion of the two-thirds of the population to access and become active users of the formal financial services.

In the next 5 years, the mission of the National Financial Inclusion policy strategy is that “300,000 adults will be active users of formal and semi-formal financial services by 2020”’. Secondly that ‘“90% of the total population will have financial services access point one hour of ordinary travel from their home”’. These are ambitious goals, but we want to be challenged.

And this begs a question. How will we reach these goals? The answer is through working with the digital financial service providers and MNOs, particularly using the Agency channel to achieve the goals. The success of Digital finance channels largely depends on the strength of the agency channel as it is through the agents that customer transactions take place. At the same time we will need to educate and train our people to use digital financial service products. We will be calling on all our partners in the National Financial Inclusion Taskforce and stakeholders to work together towards these goals.

For the banks or MNOs, their physical presence in remote locations is through the agents who conduct the transactions like Cash in and Cash out. Therefore managing the agency channel effectively is the key to increasing volume of transactions and customer satisfaction. Most important is the training of the agents so they can carry out their services professionally as well.

The Core Agency Network Accelerator (CANA) training which is branded and delivered by the Helix Institute of Digital Finance aims at providing bank and MNO officials with the appropriate skills and knowledge to build and manage a good agents channel for their digital financial service ecosystem. I understand that this training has proven to be very useful in many developing countries especially in Africa and Asia where digital financial service has seen big growth over the last few years. And you, are the first in the Pacific Region to be trained under CANA.

In concluding, in my view when we talk of the digital financial service and how we would like to see it functions properly, we are talking about the aspects of Payment system. Our economy cannot trade and cannot grow, if our payment system is not working as it should, and does not allow the people in our economy to make payments in a safe, timely and at a reasonable cost. Interoperability of the different digital platforms used by different providers will also add to the smooth exchanges in our payment system.

Agency network will be the important part of the payment system delivery channel.  And I am encouraged to know from your CANA training this week that it will give you the appropriate skills and knowledge to build and manage agency channels for their digital financial service ecosystem

Thank you and I wish you all a very successful week of training.