Agents of digital financial services in Senegal
With a high volume of activities and low operational expenditure, Senegalese agents of digital financial services are considered profitable. This is according to the survey ‘Agent Network Accelerator’ on
With a high volume of activities and low operational expenditure, Senegalese agents of digital financial services are considered profitable. This is according to the survey ‘Agent Network Accelerator’ on the agent networks of digital financial services in Senegal, released by Mobile Money for the Poor (MM4P), a UN Capital Development Fund (UNCDF) programme, in collaboration with The Helix Institute of Digital Finance.
This survey, conducted nationally with 1200 agents of digital financial services, provides key insights into the characteristics of the competitive market of money transfers shared amongst four major vendors: Wari, Joni Joni, Orange and Tigo. Getting to the corner shop to send or receive money or pay water, telephone and electricity bills has become a habit for many Senegalese. Increasingly, people use digital finance service outlets to avoid long queues and time constraints at the counter.
These financial operations and transactions are managed exclusively by financial service distributors and are the distributors’ main source of income. According to the survey, of the 1200 some agents interviewed in 2015, 66 percent are non-exclusively working with the four major providers and are distributing the services of a median of three. The adoption of this model contributes significantly to the performance of Senegalese agents.
At the outlet level, Senegalese agents conduct a volume of transactions comparable to advanced markets of East Africa, with a median of 35 transactions per day, for all combined vendors.
The survey also shows that, despite the intensification and the constant growth of this sector, major obstacles hinder the expansion of digital financial services, which are still very concentrated in Dakar and surrounding areas at the expense of rural areas. The irregularity of the services and the lack of resources to source liquidity can undermine confidence, adoption and use of digital financial services by the population.
"We must improve the quality of digital distribution services through staff capacity-building to make them more compliant. We must also improve system reliability to prevent cases of fraud and service interruptions," said Sabine Mensah, MM4P Technical Specialist Digital Finance.
Ensuring quality in the distribution of services and digital products is a prerequisite for improving people's access to financial services and ensuring financial inclusion. The agent network plays an important role in this sector by guaranteeing access to these services by the population and especially those living in rural areas.
The goal of the MM4P programme is to help the providers of these services improve their agent networks and develop innovative models to cover rural areas and contribute to financial inclusion.
MM4P works with all actors in the Senegalese ecosystem, with the major objective of ensuring that 20 percent of the adult population of Senegal is actively using a financial service via remote and digital technologies by 2019.
For more information on the Agent Network Accelerator project, follow this link.
UNCDF is the UN’s capital investment agency for the world’s 48 least developed countries (LDCs). With its capital mandate and instruments, UNCDF offers ‘last mile’ finance models that unlock public and private resources, especially at the domestic level, to reduce poverty and support local economic development. This last mile is where available resources for development are scarcest; where market failures are most pronounced; and where benefits from national growth tend to leave people excluded.
The UNCDF Mobile Money for the Poor (MM4P) programme is active in Benin, Senegal and Zambia, in partnership with The MasterCard Foundation. MM4P provides support to branchless and mobile financial services in a select group of LDCs to demonstrate how the correct mix of financial, technical and policy support can build a robust branchless and mobile financial services ecosystem that reaches low income people in LDCs.
Mobile Money for the Poor (MM4P) is a programme launched by UNCDF in partnership with the Swedish International Development Agency (Sida), the Australian Department of Foreign Affairs and Trade (DFAT), the Bill & Melinda Gates Foundation and The MasterCard Foundation. MM4P provides support to branchless and mobile financial services in a select group of LDCs to demonstrate how the correct mix of financial, technical and policy support can build a robust branchless and mobile financial services ecosystem that reaches low income people in LDCs.
We must improve the quality of digital distribution services through staff capacity-building to make them more compliant.
Spécialiste Finance digitale, MM4P