A Business model for attracting the un/under banked in today's world.

1. Business Model
for Attracting
the Un-Banked
Presented by:
Ogechi Law-Onyemah

2. THE MANDATE
In line with the CBN mandate to get the unbanked into the formal
banking system, Interswitch has developed a new card product
focused on this section of the population.
The product is designed to be cost effective with features that
meet their financial, emotional, and aspirational needs.
This card is targeted at those aged 18-45years. Socio-Economic
class D&E, with per capita income between 5,000 – 50,000.
The cards will be enabled to work on ATMs, POS, Web, and Mobile
channels.

3. The unbanked are those within the population who have no formal and informal access to banking
or financial services. These are those in the rural areas, the un-educated and semi-educated, the low-
income earners, teenagers and young adults.
According to EFinA “64.1 per cent of the adult population (of Nigeria) has never been banked, an
equivalent to 56.3 million people. The reasons stated for their exclusion from formal banking
services includes;
Cost of a opening a deposit / savings bank account
Minimum balance maintenance
Location
Bank stability
Reputation
Accessibility
Income regularity, Insufficient funds,
Closure of accounts by banks
Understanding the Target Market

4. Develop a;
1. Business Plan: Includes analysis on: WHOM, WHERE,
WHEN, HOW to attract the target market.
2. Financial Plan: Includes analysing the: Pricing, Cash-flow,
Product P&L, Break-even point
3. Marketing Plan: Includes the Branding and Marketing
activities for driving the product
ASSESSMENT

5. Business Plan
1. Product growth from 0-20million card holders in 2years
a) Prioritizing the target market from the most accessible, least accessible,
difficult to access.
b) Segmenting the target market using various demographics eg; business
type, income value, location, lifestyle, age, education and gender.
c) Qualify and Quantify those eligible for formal banking services, informal
banking services, and card usage.
d) Create new Niche Market
e) Create a product that works for the customers ie reloadable prepaid cards,
easy funds transfer system,
f) Make customer knowledge top-priority
g) Generate loyalty, create and increase revenue
h) Develop and maintain an achievable reward system
i) Acquire merchants within the target users environment

6. a) Creating a product that offers security, convenience, ease of use and
accessibility to funds
b) Create and Manage a brand that is associated with minimised risks
c) Deploy channels that are efficient and easy to use
d) Develop and Manage a team that understands and will relate well with
the customer
e) Communicate the benefits and rewards in a new light
f) Create a connection with the customers through the advertising
g) Recognize your customer, Respond to them in a way that shows you truly
know them. Let your response say: We know you, We understand you, We
are there for you.
Market entry strategy particularly against existing competing
card brands for the unbanked. Factors to consider includes;

7. 3. Sales Plan; The sales plan will include a strategy for attracting the unbanked, retaining, promoting and
increasing usage of the product.
It answers the question of WHO, WHAT, WHERE, WHEN & HOW.
Who are they? - Low income earners and Menial workers e.g: Security, House help, Drivers, Bus-conductor,
Shop-keeper, Office cleaner, etc. Semi-skilled and Un-skilled workers e.g: Factory workers, Mechanics,
Electrician, Painter, Plumber, Technician, Rig-worker, Cook, Lab-attendant, etc
What are their habits? Their habits include the things they are involved in for recreational purposes and
habits they indulge in, e.g: Shopping, Drinking – Volume consumers i.e. alcohol, Eating, Emotional Sports fans-
Football, Political Party, Market association, Religious inclination, Family or Children’s activities.
Where can they be found? The places where they engage in after-work activities, church, mosque, etc., at
work, union involvement, political parties, PTA meetings.
When is the best opportunity? The best opportunity is that time when they are most inclined to be amenable
to the sales person. E.g: On Payday i.e. mid/ month end, Union, Co-Operative or Council meeting place, The
employer or Agency, Through the religious figure head, The PTA meetings, Informal occasions e.g a new market
leader or union rep installation, a workshop.
How do we attract them? They can be attracted using various means e.g: Through their employees. E.g the
house-keepers, the shop-keepers, the security and maintenance companies, agencies etc. Union
representatives, the co-operatives the belong to, the political parties they belong to, Council where they pay

8. Product Name
Market
Entry
Rewards
Affordability
1. A Product Name that target market can
identify to:
• Verve Mini; debit or wallet with 5,000-
25,000 naira
• Verve Maxi; debit or wallet with 25,000-
40,000
• Verve Mega; debit or wallet with 40,000-
100,000
2. Affordable cards ranging between 200.00-
500.00
3. Delivered to customers with instructions
in their local dialect.
4. Customers are rewarded for specific value
stored
5. Customers are rewarded for specific value
spent on channels.
PRODUCT ENTRY STRATEGY

9. 4. Product Extension; This product can be extended to others who would
otherwise not be attracted to card usage.
Civil service pensioners
Retirees in rural areas
Military and Naval personnel
NGO and other Charity beneficiaries
Teachers in Government owned institutions
Citizens on Government aid

10. SWOT ANALYSIS
P • Coverage
• Manpower
• Financial Services
• Communication
• Employee turnover
• Market segmentation &
analyses
• New technologies
• Solutions for channels
• Market entry
• Data mining
• Growth in card usage,
transaction volume and
value
• Coverage
• Manpower
• Financial services
• Communication
• Banking or Government
regulations
• Fraud
• Income
S W
O T
SWOT
Analysis
• Product
Development
• Solutions
• Brand Name
• Customer
Understanding
• Talented team

11. Compare costs of your product or service with one or more competitors.
• Affordable
• Transparent income fees
• No minimum balance
• Liquidity of funds
• No restriction on no of
usage
• Re-loadable prepaid cards
• Pre-paid value on linked
account
• Low-fees on Funds
transfer
• Competitors Pricing
Product Pricing has to assess various
factors
Lifetime P&L per
card
Industry median
pricing
Initial fees NGN 250.00 –
NGN500.00
Monthly fees NGN0.00
ATM fees No cost
POS fees 1.25%
Mobile / Airtime
recharge fees
NGN10.00
Float from deposits NGN5.00 on every
NGN5,000
Interchange
revenues
0.006%
Est. Volume of
transactions
3X per user
Estimated Value of
transactions per-
user
NGN 2,500
Card Holder Behaviour
NGN15,000 – NGN 50,000 Initial
load
1 Load per-month
100% pin
20% is withdrawn as cash
5% of ATM Transactions are on
us
Avg. life before inactivity
6months
Direct deposit, Funds Transfer,
Salary payment Reload mix

12. The cost benefits of this product to Interswitch includes but are not limited to;
1. Direct card, terminal or solution ownership
2. Pre-paid reloadable cards at Interswitch locations
3. Transaction fees for card issuing, switching and transaction processing
4. Cash-back
5. Quick-teller or Mobile Money services
6. Bill Payments for subscriber based products, levies and taxes
7. Customised channel solutions
Cost Benefits to Interswitch

13. Building Awareness and Understanding:
Marketing Plan
Advertising at the grass-root level
Transactional agents Promotions & Rewards
Field agents
Family & Friends SMS in Local Dialects
Market Analysis
Competitive Landscaping Segmentation
Target market selection and
positioning
Marketing Communications
Unaware Aware Understanding Knowledge Trail Regular Use
Customer Journey

14. Unaware
Aware
Understanding
Knowledge
Trial
Regular Use
Customer has never heard of a payment card
Customer has heard of a payment card and
knows what it is
Customer understands how a payment
card could be useful to them
Customer knows the transaction process
and channels to use
Customer tries the service
Customer habitually uses their card for payment
services

15. BRANDING
The branding of this
product must consider the
following;
1. The Face of the product
2. The emotional and
psychological appeal to the
customer
3. The status hierarchy
acquired
4. The ease of
understanding the message

16. A Visual of some of the Un-Banked Target Market

17. THANK YOU FOR YOUR ATTENTION