IN PARTNERSHIP WITH GENDER AND DIGITAL FINANCIAL SERVICES BANKING ON THE MARKET The Service Low-income women in the bustling city of Lagos, Nigeria are both time and resource poor. However, they seek services to ‘park’ their money for larger spending purposes, such as business capital and KEY FIGURES school fees. Women have traditionally had access to an informal service called Ajo.1 Therefore, Diamond Bank decided to replicate this model to attract people into the formal banking sector. At the end of the 6-month pilot program In addition to providing a newly-designed savings account with in 21 Diamond Bank no minimum balance or transaction fees (BETA savings account), Branches, the banks Diamond Bank built a network of agents called BETA friends to work had: in the markets where these women make financial their transactions. 38,600 new accounts Innovations Going to the Customers: Queues in African banks are notoriously 40 percent of new long and many people do not have the time to do banking the accounts were held by traditional way (even though they would like to have bank accounts). women The BETA friends service allows people to save quickly, and in a place that suits them. Compensated on an incentive basis, the BETA friends create their own portfolio of customers — from an average of US$1.5 million in savings 200 customers to up to 500 for high performers. had been gathered Reduced and accessible Know Your Customer (KYC): Many 74 percent of customers customers (quite rightly) perceived the requirements to open a were transacting at least bank account onerous. Therefore, Diamond Bank needed to make once a month the registration process quick and with minimal requirements. Account opening is done through a mobile phone and a starter pack (with a Debit Card) is given immediately to the customer. No trips to branches, utility bills or references are required.2 1. The Ajo Service does a daily collection of savings at the market stalls. Typically, money can only be withdrawn at the end of the month. Fees are generally equal to one day of savings. Though commonly used, the risk of the Ajo collector running off with the money is real. 2. Nigeria has a regulatory system that allows for different KYC for different types of transactions (including balance limits and transaction limits). Marketed directly to women: The BETA savings The savings gathered is less costly than raising funds account was marketed directly to women (without on the international markets, and can therefore have a discriminating against men). The tools were designed larger spread when lent out. with women in mind, as they had previously been very hard to reach. This however did not deter men. Brand awareness and trust is developing in markets Indeed, men comprise 60 percent of the account that previously saw banks as inaccessible. Word of holders. mouth marketing puts Diamond Bank at the front of this new market. Adaptations Further opportunities Adapting the product: Diamond Bank wanted to have the deposits of these customers, but realized it Customers have expressed interest in borrowing and would need to provide a service that cost no more than realize that by formally saving, they are creating a the Ajo service. Diamond Bank built its business case history that allows them to borrow. Diamond Bank is on the low cost of funds that come from leveraging already assessing lending possibilities. savings. The account also attracts interest, and offers This new market segment presents fresh opportunities a chance to win weekly cash prizes. to offer products, such as insurance and youth banking As women are harder to convince and tend to ask (or school-based BETA friends). more questions than men, opening accounts for How this can apply to the Pacific Region women was not seen as lucrative to the BETA friends. Diamond Bank decided to pay the BETA friends The Pacific Region is still largely unbanked. higher incentives to open accounts for women as they However, it does have a number of venues where knew that women were more likely to use the account people congregate, such as markets, schools, Bingo regularly, save more, and withdraw less. Men tend to halls, churches, and so on. These are places where a see the account as more transactional than for savings BETA friends concept could be used to open accounts purposes. and make transactions. All marketing and communications are done using Bingo is enjoyed by many Pacific women. Generally, ‘everyday’ language. Banking jargon, by contrast, giving prizes to customers can entice new users into was seen as exclusionary and not well understood. registering and utilizing the product. How the BETA product and friends have Additional Resources added value to Diamond Bank https://www.womensworldbanking.org/wp-content/ Diamond Bank has grown a complete new segment of uploads/2014/03/Womens-World-Banking-A-BETA- customers that were previously untargeted. Way-To-Save.pdf Contact: Margarete Biallas | IFC Digital Financial Services Advisory | mbiallas@ifc.org IN PARTNERSHIP WITH