Derrick Dankyi, CEO at G-life Financial services, Ghana will be speaking at UNBANKED AFRICA Summit on July 14th in Lagos, Nigeria. He shared with Mobile Money Africa his remarkable experience with mobile banking in Ghana and also has some interesting answers about how to reach the poor via mobile banking.
Share the humble beginnings of G-life?
G-Life Financial Services began as a trial business on an old laptop in a small office in Accra Ghana. This idea was conceived when the main promoter traveled to Kenya on an assignment for his former organization. What thrilled him was the M-pesa model vis-à-vis the example of a local Bank in Kenya which began form the grassroots. At that point he felt more of the close to 70% of the unbanked people in Ghana; especially our rural population can be brought on board if a similar one can be implemented in Ghana. With his Mathematics and IT background, coupled with his management and Banking experience he decided to start the business, a mobile phone based microfinance institution, on a pilot basis with the support of two back office staff and three Field Agents. The company has been live since February 2, 2009.
Why the choice of mobile as a channel to reach the unbanked in Ghana?
Currently, there are over 15 million mobile phone users in Ghana. From our farms to the markets, from our schools to the offices and from the villages to the cities almost everybody owns a mobile phone. This is where G-Life Financial Services fits in the financial ecosystem in Ghana, especially for the people at the lower end of the economy of Ghana. We believe that with almost everybody having a mobile phone which has gradually become a form of identification for individuals and groups can provide financial inclusion for all via their mobile phone using their mobile numbers. Currently, we have over 14,000 accounts, we are expanding faster, we are incurring lesser expansion cost and we are recruiting more Agents in the rural communities to carry out Agency and Community banking in the model of branchless banking. This is all due to the power of the mobile phone.
For over one year now, we have been reaching out to our customers using our internally developed MIS and mobile platform. The system was designed by a team led by the CEO (the main promoter) and an experienced programmer. This has facilitated our monitoring and reporting in the area of loans and deposits mobilizations via the mobile phone and a wireless Bluetooth printer. It has a money transfer model and hopefully, in the near future, we hope to integrate our system to that of the Telecom companies to make it easier for people to access their accounts from everywhere.
Plans for Africa?
Africa? Yes. This is our home. We believe that as much as possible we must do what we can for God, country and continent to help alleviate poverty. Our model, being web based, enables us to work everywhere. We plan to cover the whole of Ghana before we embark on an expansion to Africa, with the help of interested partners. However, currently, we are in a discussion with a group of investors in one country within the SADC who want us to expand there. Therefore, new partners and investors from Africa are welcome.
What has been the greatest challenge in providing financial services to the bottom of the pyramid?
Our greatest challenge has been the people. Most of our customers work in the informal sector; farmers, traders, dressmakers, hairdressers and others. Most of these people have had experiences with “susu” companies, who may have escaped with their deposits. This has put the fear of working with organizations like ours in them. However, we believe that it’s good to start with a few accounts and the rest will follow when they see your continuity. This has really facilitated our growth.
One other challenge is the literacy level of the people in the informal sector which makes it very difficult for them to understand some basic explanations. For example, we tried sending a monthly statement of account to our customers via sms sometime ago, we charged a few Ghana Pesewas for that service and you can’t believe the phone calls which came in. The customers were simply not happy with the deductions, although, for us, the service would have provided more convenience for the customer.
What is the adoption rate like and areas of improvement?
It’s always been awesome after the initial skepticism. Our rural communities have had the best adoption rate. Sometimes, you see the thirst and hunger for financial services on their faces when you introduce the product to them and the joy which comes when their account is finally opened for them.
To enhance our services we are constantly striving to provide better incentives and reward systems for agents. Obviously, being a microfinance business which is a little over 2 years old and still sourcing for funds to enhance its operations, we believe the improve will come with time.
Is literacy rate a factor for adopting of your services in semi rural and rural areas?
I will say yes and no. Yes, because the lower literacy tend to affect their understanding of certain basic areas of our services. No, because when a few of them understand and experience the service it makes it easier for them to explain issues better to their kith and kin who then walk in enjoy our service.
Relationship with technology, mobile network operators and commercial banks in Ghana?
Currently, we do not have any formal relationship with any MNO. However, our mobile banking platform enables us to connect to our server via the GPRS from any part of Ghana. This is done with a SIM card from any of the MNO’s. In the near future, when we have more accounts, we hope to have a formal relationship with some of them to enable our customers to have a direct access to their account and to purchase airtime/ call credits via our platform. We have started this on a pilot basis in house with an intermediary company.
With regards to our relationship with the commercial banks in Ghana, I would like to say that since we are not operating as a bank, we work with a few of them which have branches in major towns closer to our areas of operation. Considering the fact that we do a lot of internet banking, we tend to prefer those who have internet banking facilities for ease of operation.
Relationship with technology, mobile network operators and commercial banks in Ghana?
Currently, we do not have any formal relationship with any MNO. However, our mobile banking platform enables us to connect to our server via the GPRS from any part of Ghana. This is done with a SIM card from any of the MNO’s. In the near future, when we have more accounts, we hope to have a formal relationship with some of them to enable our customers to have a direct access to their account and to purchase airtime/ call credits via our platform. We have started this on a pilot basis in house with an intermediary company.
With regards to our relationship with the commercial banks in Ghana, I would like to say that since we are not operating as a bank, we work with a few of them which have branches in major towns closer to our areas of operation. Considering the fact that we do a lot of internet banking, we tend to prefer those who have internet banking facilities for ease of operation.
The regulatory environment for micro finance and mobile financial services in Ghana?
The microfinance environment is not properly regulated in Ghana. The Central Bank of Ghana is, currently, considering creating an Apex Body to regulate the activities of MFI’s in Ghana. G-Life, like most commercial MFI’s in Ghana operate with a license issued by the Ghana Cooperative Susu Collectors Association, which is the only body recognized by the Bank of Ghana as the Apex body for individual susu collectors and Commercial MFI’s. But they lack the ability to regulate the growing microfinance sector. Hence, the move to create a new Apex Body by the BOG. I must also emphasis here that we are in the process of being admitted as a member of the Ghana Microfinance Network (GHAMFIN) which is pushing for a Bank of Ghana license for its members.
However, whilst we wait for the BOG, G-Life Financial Services is trying as much as possible to position itself by following internationally recognized standards for MFI’s in other parts of the world. We want to be one of the first licensees of the BOG. You can check us out on mix market (www.themix.org)
Operations coverage?
At the moment our operations cover the Greater Accra and Eastern Regions of Ghana. We have been able to open 8 main business offices and 4 satellite offices in the semi urban and rural communities. We are in the process of opening 2 more business offices to provide services for our Merchants who have recruited in the communities to do Branchless Village Banking. This is working perfectly well and customers are able to deposit money as late as 9pm in the evening, real time, through the merchants in their communities.
Most successful product?
All our products have been extremely successful. However, I must say that some of them are yet to find their feet due to the fact that our customers did not fully understand the rationale behind their introduction to the market.
Your advice to potential providers of services to bottom of the pyramid in Africa?
They must first understand that they are doing a social business. They must have a passion to help improve the living conditions of the poor and the profitability will follow. If you make money your first priority, you may never receive any satisfaction. The joy is in the transformation you bring to bear on the life of the productive poor.
Any role for international development agencies in scaling up access to underserved communities in Africa?
Absolutely. International development organizations must take a second look at the way they release funds directly to some NGO’s and governments in Africa. I think they should focus more on building local economies through village banking models via efficient mobile banking platforms. Coupled with good education and good health, our rural people can achieve their life aspirations when these Agencies choose to buy into the operations of Mobile financial service organizations. However, I wish to emphasize that the impact of such projects must be fully assessed to ensure accountability.
Background of the promoters of Glife.
1. Boahemaa Ntim
Boahemaa has responsibility for the strategic development and growth of the company. She has a degree in Finance from the University of Ghana and an MBA in Finance from the same University.
She has a career spanning 3 financial institutions in Ghana over a 10 year period. As a result of her versatility and natural flair for marketing, her entire career has been in sales and marketing of financial products. She worked with Standard Chartered Bank, Citi Savings and Loans (Intercontinental bank) and CAL Bank. She loves to take on challenges and win them!
2. Derrick Kwaku Dankyi
Derrick is currently, the Chief Executive Officer and Co-Founder of G-Life Financial Services Limited. He has had three years of experience as an IT Systems Manager in two vibrant Savings and Loans organizations in Ghana (Women’s World Banking Ghana and Ezi Savings & Loans Limited) and over five years experience working with IT systems.
He has a Bachelors Degree in Mathematics from the Kwame Nkrumah University of Science and Technology, a Post Graduate Diploma in Management Information Systems from the Ghana Institute of Management and Public Administration and is currently pursuing an Executive MBA in Project Management with the University of Ghana. His passion is to drive every project with Management Information Systems and IT. He is the lead promoter of the G-Life Mobile Financial Services via the gSika Platform. Derrick is also an Executive Director of Logiciel Ghana Limited, a software development company which provides IT solutions for Banks and Insurance Companies.
His desire is to see banking delivered to the doorstep of the close to 70% unbanked population in Ghana and beyond with the extensive use of IT, Management Information Systems and excellent Human Resources Management.
Your local partners?
Star Microinsuarnce
Social Security and National Insurance Trust, Informal Sector
National Health Insurance Scheme
Dorcas Foundation (NGO)
What should delegates expect from you and your organization at UNBANKED AFRICA Summit at Lagos Orientals on July 14th?
Delegates should expect to nothing but the growth of a home grown Mobile Financial Services passionate about sending real mobile financial services to the unbanked.
Source: http://mobilemoneyafrica.com/?p=3748
