Deployment of an agent network in rural Senegal.
Ruth Thiemele-Kadjo, Digital Financial Service and Risk Management Consultant, PHB Development
Bery Dieye Kandji, Knowledge Management and Communication Consultant, UNCDF MM4P
Moussa struggles with liquidity issues that prevent him from adaquately serving his customers.
Like many agents in rural Senegal who have seen many scams, Massal Thiam was at first sceptical when a salesman introduced him to ‘Guichet Unique’—a solution launched by the fintech InTouch. For US$59, Guichet Unique is a mobile phone with an app that allows an agent to conduct mobile money transactions (cash-in, cash-out and airtime top-up) on behalf of the country’s main providers (Expresso, Orange and Tigo).
After speaking to a relative about it, Massal decided to borrow some money from the relative and buy the InTouch solution to test it out. He has since averaged US$106 in commissions per month (1.5 times the average minimum revenue in Senegal). Massal believes the investment was worth it.
The easy-to-use and interactive app has been a hit among agents like Massal who have quickly mastered its use. Agents appreciate that the InTouch solution helps them avoid the need to have multiple phones or switch SIM cards. Massal likes that he is able to provide a much-needed service to his community, especially to all those people who used to travel miles to the nearest big city to make deposits or withdrawals like patients from a nearby health centre.
"When I got to know about the InTouch solution, I immediately thought that it would be really helpful to patients in the health care centre, who had issues getting money from their relatives to pay for their medical fees,” Massal confides.
Massal is one of 88 agents who are part of a joint project by InTouch and the UN Capital Development Fund programme MM4P seeking to overcome some of sustainability barriers facing agents in rural Senegal. In March 2018, a team from the consulting firm PHB Development interviewed 22 of the agents as part of agent network research in Foundiougne and Nioro du Rip Departments.
Most of the agents interviewed are generally satisfied with the solution, although they face challenges specific to their rural environment. The most common problem is liquidity management, that is, cash and e-money management. In some cases, agents have to travel long distances to reach a supplier. To do so, they have to close their shops and put their business activities on hold until they return.
Moussa Ndao, an InTouch agent and owner of a hardware store in Djilor, is attracted to the advantages offered by the InTouch solution but would like to find a more efficient way to address liquidity issues as well as connectivity problems that sometimes prevent him from completing transactions.
"I'm not complaining about the application, but I'm having trouble with my transactions because of the Internet connection problems here. This situation is very uncomfortable because the customers are not patient and it makes me lose money,” Moussa shares.
Internet connectivity is a significant challenge observed in the project. At a time when the capital city Dakar has 4G, rural areas visited during the research only have 2G available—that is, when it works! This low network coverage drastically impacts operations of rural agents.
Illiterate agents also report difficulties navigating the app menu, especially recent transaction history.
Fortunately, the research by PHB Development helped the team at UNCDF MM4P and InTouch reflect on issues reported by agents and identify a number of quick-wins. Regarding liquidity, the research team observed that some agents wait until they completely run out of cash or mobile money before they rebalance. To avoid this situation, InTouch is looking into an alert system that will help agents better manage their float.
Regarding connectivity, complementary technologies such as SMS, USSD and satellite Internet access, can provide good alternatives. The country’s Telecommunications and Postal Regulatory Authority (known as ARTP) has recently opened up the USSD channel to digital financial service providers. However, this solution will take a while to implement and the project with UNCDF MM4P concludes at the end of January 2019.
Stay tuned to read more about the results InTouch reaches in rural areas of Senegal.