1. All members of the channel require training
2. Offsite training course for new agents
3. Agent training is not a onetime event
4. Effective training is best done by dedicated trainers managed against clear KPIs
5. Training must go beyond the practical “how to” and cover the business case

In the second part of the webinar, we discussed specific questions raised by the participants. In particular, we debated whether or not it was effective and advisable to use a dedicated resource for training mobile money agents. Some participants made the point that it would be convenient and cost-effective to use existing resources already working in mobile money such as master agents or agent network management teams. Unfortunately, this proves ineffective. The main reason for this is that their incentives and KPIs are ultimately to drive sales and transaction volumes. If they are tasked with training, they do not allocate adequate time to the activity and are not incentivised to push quality assurance or compliance. This is why MMU recommends using dedicated resources for training mobile money agents.

The following questions were also discussed:

• Why isn’t agent training at the shop adequate?
• How do I deal with issues of agent illiteracy?
• Which media do you find best for training? Role Play, flip charts, PowerPoint, group work etc…?
• Should agents be charged a fee for training?
• How often do I need to think about training the agents?
• Aside from outputs and outcomes what other KPIs can be used to manage an out-sourced company doing agent training?

If you couldn’t attend the webinar, you can review our slides (also available in French) as well as watch to the recording.

Agent networks in mobile money thrive when they have convenient ways to access liquidity, compelling commissions, well merchandised and monitored shops and, well trained agents.  Well trained agents are more likely to drive transaction volumes for the operator, educate the customers on how the service works and deliver error free transactions.

Based on its work with high performing mobile money services, MMU has developed Designing & Delivering Agent Training for Mobile Money Deployments, which is a practical guide to agent training and makes the following recommendations:

1. All members of the mobile money distribution channel require training – Business owners, shop handlers, agent management teams, Master Agents, foot soldiers, etc. are all important members of the distribution team who need to have a complete understanding of the mobile money product.
2. Centralised training is effective at the beginning of a deployment but will likely need to evolve to regional decentralised training as the agent network grows
3. Agent training is not a onetime event – Agents will need refresher courses on a periodic basis and will need training on new products. Agent training should be thought of as an ongoing part of a mobile money service.
4. Dedicated trainers with clear KPIs for performance management is necessary to deliver effective agent training
5. Training curriculum must go beyond the practical “how to” of executing mobile money transactions – It importantly must also cover the business case for how to make money on mobile money, the company guidelines for agent behaviour and regulatory compliance requirements.

What is your approach to agent training?  How long is your course? Where do you train agents?  Can Master Agents train agents? Can agents fail training if they don’t pass the test? How do you deal with shop handler turn over?  What should be included in the agent curriculum?

Please send us your questions and opinions!

And join Gerry, Yasmina and other mobile money managers on October 9 at 10am London Time for a webinar discussion on the practicalities of agent designing affordable and cost effective agent training programmes.

Le webinaire sera également donné en français le 10 octobre à 11:00 London Time.

To register, please email mmu@gsm.org.

Download the full report here

In the mobile industry, operators are able to use tools like Wireless Intelligence to benchmark their performance in terms of customer adoption, but, until now, no such resources have existed for mobile money.

Paul Leishman wrote a blog post about what KPIs mobile money service providers should track. The Survey results revealed that there were eight fast-growing services among the 52 that participated in the Survey. Today, we are able to tell you how this group of fast-growing services performs on these key KPIs compared to the rest. So, ready to benchmark with the best?

Number of active customers relative to mobile base

These 8 services have in common the fact that they have been able to grow their number of active customers very quickly. 2.6% of their mobile base had become active mobile money users six months after launch, and 5.6% were active mobile money users twelve months after launch. The averages for other services were 0.2% and 0.3%, respectively.

Active rate for customers

The average active rate for customers (i.e., the ratio of the number of active accounts to registered accounts) of fast-growing services is somewhat higher than the average for other services surveyed: 23.2% compared to 13.6% in June 2011. However, we observe significant variations within that group with active rates ranging from 13.4% to 80.0%. In large part, this is because these services have employed different registration strategies. This demonstrates that different strategies can be equally successful and that the customer active rate is not in itself a good measure of success.

Customer engagement

Customers of fast-growing services are more engaged. On average, active customers of these fast-growing services perform 3.7 functional transactions (p2p transfers, bill payments, bulk payments and airtime top ups) per month, whereas the average for other services is 2.5. In particular, the number of P2P transfer per active customer per month is 1.2 for fast-growing services compared to 0.5 for other services.

Agent engagement

Agents of fast-growing mobile money services are far busier than those of other services. On average, they do 28.5 cash-ins and cash-outs per day whereas agents of other services perform only 3.8 transactions a day. There is actually a strong statistical relationship between the average number of transactions that agents of a given mobile money service perform each day and the performance of the service. This is not a tautology: in theory, successful services could spread a large number of agent transactions across many agents, while a service registering a relatively small number of transactions could have few, but busy, agents. But we find that, deliberately or not, the most successful services have calibrated the growth of their agent networks to ensure that agents, on average are able to perform a meaningful volume of transactions.

Customer and agent balance

We can draw the same conclusion if we look at the numbers of active customers per active agent: with a ratio of 161, fast-growing services are far from other services whose active agents serve on average 37 active customers.

Product mix

Finally on product mix, the percentage of functional transactions that are airtime top ups is smaller for fast-growing services (63%) than for other services (78%). For 4 of the 8 fast-growing services, airtime top ups represent less than 50% of the transactions performed by mobile money users.

Read the 2011 Global Mobile Money Adoption Survey

Three participants, Safaricom, SMART and Globe submitted incomplete surveys. As such, the averages that we present do not always include the full sample.

At one level, the answer is obvious. The less you pay agents, the more attractive the mobile money business case becomes. What’s more, when operators sell airtime on their mobile money platform, they are effectively switching customers to a lower-cost channel and therefore reduce their cost of goods sold. These savings flow straight to the bottom line.

But of course, there is the agent’s point of view to consider. The return that any retailer earns is a function not just of the margin they earn, but also the volume of goods they sell. That means that you can persuade a retailer to add a lower-margin good to their inventory if they accept that that good will be faster moving.

Safaricom got away with offering retailers M-PESA commissions that were lower than airtime margins because they were able to ensure that agents were busy, which meant that their inventory of e-money and cash was turning over fast. I suspect that the average M-PESA agent in Kenya does an order of magnitude more volume compared to the average airtime retailer, which more than compensates them for the lower margin they earn on each transaction. Safaricom achieved this by closely managing the ratio of customers to agents, never letting the number of agents get so large as to dilute the volume of transactions, and thus the return, of the average agent.

In many markets, however, mobile money agents actually perform fewer transactions per day than airtime retailers do. This implies that the business case for serving as a mobile money agent is worse than for selling airtime both in margin and volume terms. Is it any wonder that agent illiquidity is one of the biggest challenges that face mobile money deployments? Agents have options when it comes to deploying their capital, and if mobile money doesn’t seem like a good one, they’ll invest in something else.

The moral is as general as it is simple. You can find a channel for a low-margin good so long as it will sell fast. You can find a channel for a slow-moving good so long as it is high margin. But trying to find a channel for a slow-moving, low-margin good is doomed to fail.

The good news is that this means operators with an underperforming channel have two different levers to pull to restore agents’ engagement and liquidity. The first and probably best is to increase the volume of transactions that agents perform. The other is to pay agents better commissions. But either will help.

But collecting these reports, consolidating the data, summarizing the results in a way that is insightful and actionable (including a system for flagging problems until they are resolved) is a challenge. That’s why I was impressed by a new tool that’s recently been rolled out to the trade development representatives (TDRs) employed by MTN to support the MobileMoney agent network in Uganda. Each TDR carries an inexpensive Android handset with an application installed that replaces a paper checklist (such as the ones that TDRs employed by Top Image in Kenya use when visiting M-PESA agents for Safaricom). The TDR can quickly complete the electronic form while at the agent shop. Not only do TDRs use the form to report on an agents’ performance; they can also highlight issues which need attention but which they cannot resolve on the spot, such as “agent re-training required.”

When they’ve finished filling out the form and the TDR hits submit, the report is uploaded electronically and a database, which contains every report on every agent outlet, is updated. In this case, that database is hosted by Salesforce.com, which makes it easy to manipulate the data and create reports that are useful to management; a list of agents who require re-training, for example, could be forwarded to the point person for scheduling attendance at training sessions.

This system not only provides management with better visibility into the workings of its agent network; it also provides better visibility into productivity of its field representatives. Reports from agent shops are geo-tagged, making it significantly more difficult for a TDR to, say, file reports on agents he hasn’t actually visited.

This system was created for MTN by AppLab, an initiative of the Grameen Foundation. Their team has calculated that the cost of deploying these handsets pays for itself in seven months. How? The time that TDRs would otherwise spend doing manual data entry and data collation if they were using a paper-based system can now be spent focused on what’s most important: monitoring, and improving, agent performance.

At a recent MMU Working Group, the CEO of Top Image in Kenya described the importance of agent monitoring. Examples of checklists that several agent-mediated financial services use around the world to track the performance of their agents can be found in the appendices of CGAP’s Agent Management Toolkit.

The use of independent retail agents is what, in the first wave of mobile money, has dramatically reduced the cost of cash-in and cash-out compared to doing so in bank branches. Recently, TigoPesa in Tanzania has taken this one step further.  They have begun to appoint roving agents, who aren’t confined to a single retail shop but who can, as the name implies, perform cash-in and cash-out transactions anywhere. They carry a handset with a merchant SIM that is loaded with e- float and cash, and they wear eye-catching aprons which distinguish them from the more common roving airtime resellers.

This is great for customers. Roving agents make “doorstep service” possible—serving customers where they live and work, rather than making them find the nearest retail agent. This makes it more convenient for customers to use the service. In Indonesia, several banks have introduced “smiling ATMs,” bank employees who are armed with a mobile POS device and who can process deposits and withdrawals. This level of service may also make it more likely that customers will take advantage of the ability to store value in their account as a simple way to save. Ghana is famous for its susu collectors, who visit clients regularly (typically daily) at their home or business to collect small amounts to save. Roving agents can allow customers to build up the same habit with mobile money.

Roving agents can make a meaningful difference to the business case, too. Roving agents will have a lower cost structure than retail agents. There’s no rent or other overheads to pay; instead, the roving agent just needs to earn a decent wage. If they are able to perform as many or more transactions as a retail agent, then significant cost savings are possible without eroding the agent’s value proposition. One possible implication of this is that roving agents may someday be able to facilitate very small value cash-in and cash-out transactions that are uneconomical at retail agents.

Why don’t we see roving agents in more markets? One reason is that regulators are concerned about their reliability. But because mobile money services post transactions in real time and require agents to trade on their own account, cashing in or cashing out with a roving agent is really no less safe than buying a physical good (like batteries or an airtime scratch card) from a roving salesman. Roving agents may be at greater risk of theft than retail agents, and operators may choose to limit the amount of float that they can carry in cash. But since that cash belongs to the roving agent, he has every incentive to make prudent decisions for himself about how much to carry.

Tigo has been pushing the innovation frontier outside of Tanzania, too: you can download MMU’s recent case study about Giros Tigo in Paraguay here.

Q&A Session

You can access Part 1 via our Blog or the Agents Networks Topic Page

Next week we will post the second part of this session. Stay tuned.

These presentations are available in English and Spanish.

[Add film clips]

These presentations are available in English and Spanish

1. Mobile Money Pricing – (presented by Paul Leishman)

2. Precios del Dinero Movil – Part 1 and 2 (presented by Camilo Tellez)