Agency Banking

Agency Banking

Agency Banking is rapidly growing as a means to swiftly reach and recruit new customers, migrate customers from banking halls to the contracted agents, provide convenient services and save on the infrastructure costs associated with setting up bank branches. This leaves the bank to concentrate on the core relationship banking business by outsourcing the cash/transactional business.

How effective are the current Agency Banking systems? What are the factors to consider when setting up Agency Banking? What is the marketing mix to engage to ensure maximum visibility? How can banks effectively manage agent relationships to ensure a sustained symbiotic business relationship?

In the future, Banking and Financial Services will be required BUT brick and mortar branches will not be needed.

Agency Banking

Agency Banking is a crucial distribution channel for financial institutions. This model empowers financial institutions to spread their stems to the grassroots, reaching rural and often hard to reach areas with huge populations and where bank branches may be hard to set up. It facilitates the migration of cash transactions from branch to agents, mobilisation of cheap deposits, as well as providing a channel for new customer acquisition .

A financial institution can leverage on existing retail infrastructure, drastically lowering set up and running costs of a branch and boosting profit margins. Agency Banking has proved to be the best magnet for low-income population, whose collective power in the banking sector has been felt in the last decade.

Strategies for Effective Agency Banking

Liquidity availability, security, customer awareness and proper systems influence the update of Agency Banking. Transaction failures and errors frustrate the credibility of Agency Banking. The right combination of manpower, systems, branding, relationship management and marketing fuel the success of Agency Banking.